Allegiant Travel's Long-Term Earnings Power From Sun Country Acquisition Not Priced Into Stock, UBS Says

12:06 PM EDT, 09/14/2026 (MT Newswires) -- Allegiant Travel's (ALGT) long-term earnings potential from the combined Allegiant-Sun Country entity has not been appropriately priced in by the market, UBS Securities said Sunday in a note. UBS sees significant EPS growth over the next few years as the company extracts synergies from its Sun Country acquisition. The firm's estimates point to potential for 80% EPS growth in 2027 to about $9, followed by 50% growth in 2028 to $13.36, according to the note. The bank also sees upside to Allegiant Travel's $140 million synergy target and believes the company will raise the target at its analyst day in December, which should serve as a positive catalyst for the stock, the note added. Incremental sources of synergies, such as improved cargo efficiency, optimization of ancillary revenue and higher fleet flexibility, were likely not incorporated in the guidance, UBS said Fifty percent of the synergies are expected to be realized in 2027, which should allow Allegiant to grow the revenue per available seat mile faster than the cost per available seat mile, the bank said. UBS upgraded Allegiant Travel to buy from neutral and lowered its price target to $107 from $111. Price: 78.59, Change: +0.32, Percent Change: +0.41