Core Viewpoint - Airlines are often not appealing long-term investments due to revenue and cost dynamics, but Sun Country Airlines presents an attractive business setup [1]. Group 1: Company Analysis - Sun Country Airlines is highlighted as having a favorable business model within the airline industry [1]. - The analysis is driven by data-informed insights, focusing on growth prospects in the aerospace, defense, and airline sectors [1]. Group 2: Industry Context - The aerospace and airline industry is characterized by significant growth potential, despite the challenges faced by airlines in terms of revenue and cost management [1].

Group 1 - Sun Country Airlines President and CFO Dave Davis will participate in a fireside chat at the Barclays Industrial Conference on February 20, 2025, at 11:00 AM EST [1] - The live webcast of the event will be available on the Sun Country investor relations website [1] Group 2 - Sun Country Airlines is a hybrid low-cost air carrier focused on connecting guests to leisure and visiting friends and relatives (VFR) passengers, as well as charter customers [2] - The company provides cargo services to Amazon and operates flights throughout the United States and to destinations in Mexico, Central America, Canada, and the Caribbean [2]

Fleet and Operations - As of December 31, 2024, the fleet consisted of 63 Boeing 737-NG aircraft, including 45 passenger aircraft and 12 cargo aircraft operated under a contract with Amazon[102]. - The company plans to increase the number of cargo aircraft operated for Amazon from 12 to 20 by the end of the third quarter of 2025[103]. - The average pitch of seats across the fleet is approximately 31 inches, providing comparable legroom to Southwest Airlines[98]. - The company has doubled its non-stop destinations from MSP since 2019, serving approximately 104 markets in 2024[112]. - The scheduled service completion factor was 98.7% in 2024, slightly down from 99.0% in 2023, indicating strong operational performance[138]. - Approximately 94% of 2024 Scheduled Service capacity, measured by ASMs, had Minneapolis-St. Paul (MSP) as either their origin or destination[245]. - The average daily aircraft utilization was 7.3 hours for the year ended December 31, 2024, compared to 6.9 hours for 2023[270]. Financial Performance - In 2024, the company flew 4.5 million Scheduled Service passengers, with an average total fare per passenger of approximately $159.93, down from $176.30 in 2023[104]. - The average ancillary revenue per passenger increased to approximately $68.68 in 2024, compared to $66.69 in 2023[108]. - The company generated ancillary revenues of $307.9 million and $276.1 million for the years ended December 31, 2024 and 2023, respectively[215]. - Labor costs represented approximately 34% and 32% of total operating costs for the years ended December 31, 2024 and 2023, respectively[266]. - Aircraft fuel costs represented approximately 24% of total operating costs in 2024, down from 27% in 2023, with fuel consumption increasing from 79,574 thousand gallons in 2023 to 86,185 thousand gallons in 2024[139]. - The company aims to maintain its ancillary revenues, which are critical for its strategy to lower base fares and stimulate demand for air travel[261]. Market and Competition - The company faces significant competition from new entrants, low-cost carriers (LCCs), ultra-low-cost carriers (ULCCs), and legacy network airlines, which could impact its market share and profitability[188]. - Increased competition in the Minneapolis market from low-cost carriers or legacy airlines could adversely affect the company's business and results of operations[245]. - The airline industry has experienced significant consolidation, which could alter competitive dynamics and permit competitors to reduce fares[196]. - The company may not be able to increase ticket prices sufficiently to cover rising fuel costs, particularly in a competitive environment[186]. Regulatory and Compliance - The airline's operations are subject to extensive regulation by the DOT and FAA, which oversee economic authority and safety compliance[162]. - The company emphasizes compliance with laws and regulations, but failure to do so could result in fines, penalties, and increased compliance costs[237]. - The company is subject to various consumer protection regulations that could impose additional compliance costs and operational challenges[215]. - Compliance with existing and future environmental laws and regulations may require significant expenditures and operational changes, potentially affecting financial performance[220]. Safety and Community Engagement - Sun Country Airlines invests in safety programs, including Flight Operations Quality Assurance and advanced training devices, to enhance safety and efficiency[154]. - The airline has established a partnership with the FAA and labor unions through ASAP to encourage the reporting of safety issues without fear of enforcement[155]. - Sun Country Airlines has engaged in community initiatives, including supporting the Hennepin Theatre Trust Spotlight Education program and investing in STEM education for disadvantaged students[159]. - Sun Country Airlines is committed to maintaining the highest level of safety compliance, guided by established procedures and policies[151]. Strategic Initiatives - The company launched 16 new markets since the start of 2024, with non-MSP service comprising 14% of all markets served in 2024[113]. - The company’s growth strategy includes expanding its aircraft fleet and market presence, particularly at MSP and non-MSP point-to-point markets[231]. - The company’s loyalty program, Sun Country Rewards, is designed to encourage customer loyalty by allowing points to be used like currency for ticket purchases[136]. - The company’s marketing strategy targets core leisure and VFR travelers, utilizing a proprietary email list of approximately two million addresses[134]. Challenges and Risks - The airline industry is highly sensitive to economic conditions, with a recession potentially leading to a material adverse effect on demand for services[181]. - The company faces challenges in hiring pilots and crew due to industry-wide staffing shortages, which could impact operations under the A&R ATSA[243]. - The company is dependent on the availability of aircraft fuel, which is unpredictable and can be affected by various external factors[185]. - The company may experience significant maintenance expenses due to unscheduled maintenance events, which can impose material unplanned costs[277]. - The company faces potential reputational harm and legal liability from accidents or incidents involving its aircraft or personnel[249].

Core Viewpoint - Sun Country Airlines Holdings, Inc. announced a secondary public offering of 6,346,105 shares of common stock, which will close on February 11, 2025, and is managed by affiliates of Apollo Global Management, Inc. [1] Group 1: Offering Details - The offering consists of all remaining shares owned by the Selling Stockholder, and Sun Country Airlines will not sell any shares or receive any proceeds from this offering [2][1] - Sun Country Airlines plans to purchase approximately $10 million of shares from the underwriters at the same price as the offering, funded by existing cash [3] - Barclays and Morgan Stanley are acting as joint bookrunners and underwriters for the offering, which may be sold through various methods on the Nasdaq Global Select Market [4] Group 2: Company Overview - Sun Country Airlines is a hybrid low-cost air carrier based in Minnesota, focusing on leisure and visiting friends and relatives (VFR) passengers, charter customers, and providing cargo services to Amazon [7]

Core Viewpoint - Sun Country Airlines Holdings, Inc. has announced a proposed secondary public offering of 6,346,105 shares of its common stock, which will be sold by an affiliate of certain investment funds managed by Apollo Global Management, Inc. The company itself will not sell any shares or receive any proceeds from this offering [1][2]. Group 1: Offering Details - The offering consists of all remaining shares owned by the Selling Stockholder [1]. - Sun Country Airlines has authorized a Concurrent Share Repurchase of approximately $10 million of shares at the same price as the offering, to be funded from existing cash [3]. - Barclays and Morgan Stanley are acting as joint bookrunners and underwriters for the proposed offering, which may be sold through various methods including direct sales, brokerage transactions, or negotiated transactions [4]. Group 2: Company Overview - Sun Country Airlines is characterized as a hybrid low-cost air carrier, focusing on leisure and visiting friends and relatives (VFR) passengers, as well as charter customers and cargo services, particularly to Amazon [7].

Sun Country Airlines Holdings, Inc. (SNCY) reported $260.41 million in revenue for the quarter ended December 2024, representing a year-over-year increase of 6.1%. EPS of $0.27 for the same period compares to $0.12 a year ago.The reported revenue represents a surprise of +0.97% over the Zacks Consensus Estimate of $257.92 million. With the consensus EPS estimate being $0.21, the EPS surprise was +28.57%.While investors scrutinize revenue and earnings changes year-over-year and how they compare with Wall Str ...

Core Insights - Sun Country Airlines reported record financial results for Q4 2024, with total revenue of $260.4 million, a 6.1% increase from Q4 2023, and the highest fourth quarter on record [1][3][8] - The company achieved a GAAP diluted EPS of $0.24 and an adjusted diluted EPS of $0.27 for Q4 2024, reflecting significant year-over-year growth [1][3][5] - For FY 2024, total revenue reached $1.08 billion, marking the highest full year on record, despite a decline in operating income and net income compared to FY 2023 [1][3][4] Financial Performance - Q4 2024 operating income was $26.1 million, with an operating income margin of 10.0%, while adjusted operating income was $27.5 million, resulting in an adjusted operating income margin of 10.6% [1][3][4] - FY 2024 GAAP diluted EPS was $0.96, down 22.0% from FY 2023, while adjusted diluted EPS was $1.05, a decrease of 23.4% [1][3][4] - The company reported a net income of $13.4 million for Q4 2024, a 138.0% increase from Q4 2023, while FY 2024 net income was $52.9 million, down 26.7% from FY 2023 [3][4][29] Capacity and Operations - System block hours flown in Q4 2024 increased by 2.7% year-over-year, with a 3.5% rise in scheduled service ASMs [7][31] - The company anticipates total block hour growth of 7% to 9% for Q1 2025, with scheduled service ASMs expected to grow slightly more than 7% compared to Q1 2024 [7][15] - Cargo block hours declined by 2.5% in Q4 2024, but significant growth is expected in the cargo segment starting in Q2 2025 [7][10] Revenue Streams - Passenger market conditions improved in Q4 2024, with scheduled service TRASM declining by 1.0% on a 3.5% increase in scheduled service ASMs [8][31] - Cargo revenue reached $28.6 million in Q4 2024, a 13.1% increase from Q4 2023, driven by annual rate escalations and new Amazon contract rate increases [10][11] - Charter service revenue for Q4 2024 was $48.0 million, reflecting a 2.3% year-over-year increase [9][11] Cost Management - Q4 2024 CASM fell by 0.7%, while adjusted CASM increased by 7.6% year-over-year due to lower ASM growth [11][32] - Total GAAP operating expenses rose by 2.6% year-over-year, influenced by a 14.5% increase in maintenance costs and an 18.4% rise in landing fees and airport rent [11][32] - The company successfully controlled costs, with full year 2024 adjusted CASM increasing only 1.3% over 2023 [5][11] Balance Sheet and Liquidity - As of December 31, 2024, total liquidity was $205.6 million, with net debt at $438.2 million [12][13] - Cash and cash equivalents increased to $83.2 million from $46.3 million year-over-year [12][35] - Total assets grew slightly to $1.63 billion, while total liabilities decreased to $1.06 billion [35][36] Future Outlook - The company expects Q1 2025 total revenue to be between $330 million and $340 million, representing a 6% to 9% increase compared to Q1 2024 [15][16] - Economic fuel cost per gallon is projected to be $2.76, an 8% decrease from the previous year [15] - The operating income margin for Q1 2025 is anticipated to be between 17% and 21% [15]

Exhibit 99.1 Sun Country Airlines Reports Fourth Quarter and Full Year 2024 Results Q4 2024 total revenue of $260.4 million, highest fourth quarter on record Q4 2024 GAAP diluted EPS of $0.24 and operating income margin of 10.0% Q4 2024 Adjusted diluted EPS of $0.27 Q4 2024 Adjusted operating income margin of 10.6% , highest fourth quarter on record FY 2024 total revenue of $1.08 billion, highest full year on record FY 2024 GAAP diluted EPS of $0.96 and operating income margin of 9.9% FY 2024 Adjusted dilut ...

Sun Country Airlines Holdings, Inc. (SNCY) closed the last trading session at $16.18, gaining 7.9% over the past four weeks, but there could be plenty of upside left in the stock if short-term price targets set by Wall Street analysts are any guide. The mean price target of $20.43 indicates a 26.3% upside potential.The mean estimate comprises seven short-term price targets with a standard deviation of $2.82. While the lowest estimate of $16 indicates a 1.1% decline from the current price level, the most opt ...

Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore strong picks.Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader market. Value investors use tried-and-true metrics and fundamental ...