Alaska Air Group, Inc.: 2Q26, Review

Research evidence excerpt

Alaska Air Group, Inc.: 2Q26, Review

Equity Research

North America Airlines

21 July 2026

Alaska Air Group, Inc.

2Q26, Review

Alaska 3Q26 outlook likely a bit below investor expectations,

especially following stronger near-term revenue guidance

from Delta and United in the past two weeks; nonetheless, ALK OVERWEIGHT Unchanged

long-term improvement potential remains robust for patient North America Airlines POSITIVE

Alaska shareholders. Unchanged

Price Target USD 65.00

lowered -7% from USD 70.00

Where we stand: Following relatively strong 2H26 earnings outlooks from Delta and United,

Price (21-Jul-26) USD 45.46especially considering the revenue guidance each provided, Alaska’s results tonight feel a bit

Potential Upside/Downside +43.0%soft. On the plus side, Alaska management guided to “low double-digit” unit revenue gains in Source: Bloomberg, Barclays Research

the third quarter, up from +8.6% in the third quarter. However, 2H26 guidance for improvement

from already double digit gains in second quarter unit revenues at Delta and United likely led to

Market Cap (USD mn) 5065

higher expectations from Alaska. Nonetheless, the company faced some relative pressure in the

Shares Outstanding (mn) 111.43second quarter from lower spring break travel demand to Hawaii, which was impacted by

Free Float (%) 99.27significant weather. Further, with management paring capacity growth plans by about 1% in the

52 Wk Avg Daily Volume (mn) 3.5third quarter (ASMs expected up 2-3%), non-fuel unit cost inflation is expected to be “up low to

Dividend Yield (%) N/Amid-single digits”, which has our model driving inflation higher by about 100bps (prior forecast

Return on Equity TTM (%) 1.86+2.6%, now +3.5% in 3Q26). Combined with guidance for higher fuel prices given the recent rise