Reviewing Air Canada (OTCMKTS:ACDVF) & Allegiant Travel (NASDAQ:ALGT)

Air Canada (OTCMKTS:ACDVF) and Allegiant Travel (NASDAQ:ALGT) are both mid-cap industrials companies, but which is the better stock? We will contrast the two businesses based on the strength of their profitability, valuation, risk, dividends, analyst recommendations, institutional ownership and earnings.

Analyst Recommendations

This is a breakdown of current ratings and target prices for Air Canada and Allegiant Travel, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Air Canada	1	3	6	1	2.64
Allegiant Travel	1	4	9	1	2.67

Allegiant Travel has a consensus target price of $123.38, suggesting a potential upside of 51.34%. Given Allegiant Travel’s stronger consensus rating and higher probable upside, analysts plainly believe Allegiant Travel is more favorable than Air Canada.

Volatility and Risk

Air Canada has a beta of 1.54, suggesting that its stock price is 54% more volatile than the S&P 500. Comparatively, Allegiant Travel has a beta of 1.65, suggesting that its stock price is 65% more volatile than the S&P 500.

Insider & Institutional Ownership

85.8% of Allegiant Travel shares are held by institutional investors. 12.8% of Allegiant Travel shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares Air Canada and Allegiant Travel’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Air Canada	1.22%	18.75%	1.53%
Allegiant Travel	0.90%	10.83%	2.75%

Earnings & Valuation

This table compares Air Canada and Allegiant Travel”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Air Canada	$16.01 billion	0.25	$460.91 million	$0.73	22.05
Allegiant Travel	$2.61 billion	0.86	-$44.70 million	$1.41	57.82

Air Canada has higher revenue and earnings than Allegiant Travel. Air Canada is trading at a lower price-to-earnings ratio than Allegiant Travel, indicating that it is currently the more affordable of the two stocks.

Summary

Allegiant Travel beats Air Canada on 10 of the 14 factors compared between the two stocks.

About Air Canada

Air Canada provides domestic, U.S. transborder, and international airline services. The company provides scheduled passenger services under the Air Canada Vacations and Air Canada Rouge brand names in the Canadian market, the Canada-U.S. transborder market, and in the international market to and from Canada, as well as through capacity purchase agreements on other regional carriers. As of December 31, 2023, it operated a fleet of 203 aircraft under the Air Canada brand name comprising 115 Airbus narrow-body aircraft, and 88 Airbus wide-body aircraft; 118 aircraft under the Air Canada Express brand name, including 25 Embraer 175, 15 Mitsubishi CRJ-200, 35 Mitsubishi CRJ-900, and 43 De Havilland Dash 8-400aircraft; and 40 aircraft under the Air Canada Rouge brand name consisting of 17 Airbus A321 aircraft, 5 Airbus A320 aircraft, and 18 Airbus A319 aircraft. The company provides air cargo services in approximately 50 countries, including Toronto, Halifax, St. John's, Miami, Atlanta, Dallas, Quito, Lima, San Juan, Mexico City, Guadalajara, Bogotá, Madrid, Frankfurt, Basel, and Liege. In addition, it develops, operates, markets, and distributes vacation travel packages in the Caribbean, Mexico, the United States, Europe, Central and South America, South Pacific, Australia, and Asia; offers cruise packages in North America, Europe, and the Caribbean; and provides travel loyalty programs. Air Canada was founded in 1937 and is headquartered in Saint-Laurent, Canada.

About Allegiant Travel

Allegiant Travel Company, a leisure travel company, provides travel services and products to residents of under-served cities in the United States. The company offers scheduled air transportation on limited-frequency, nonstop flights between under-served cities and leisure destinations. As of February 1, 2024, it operated a fleet of 126 Airbus A320 series aircraft. The company also provides air-related services and products in conjunction with air transportation, including baggage fees, advance seat assignments, travel protection products, priority boarding, a customer convenience fee, food and beverage purchases on board, and other air-related services, as well as use of its call center for purchases. In addition, it offers third party travel products, such as hotel rooms and ground transportation, such as rental cars and hotel shuttle products; and air transportation services through fixed fee agreements and charter service on a year-round and ad-hoc basis. Further, the company operates a golf course. Allegiant Travel Company was founded in 1997 and is based in Las Vegas, Nevada.