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Investing.com - Seaport Global Securities initiated coverage on Frontier Group Holdings Inc (NASDAQ:ULCC) with a Neutral rating on Thursday. The airline, currently trading at $5.14, has shown strong returns over the past three months despite operating with significant debt of $4.87 billion and negative EBITDA of $254 million.
The research firm’s decision comes as analyst Daniel McKenzie evaluates the airline’s position in the current market environment.
Seaport Global noted that Frontier shares present "option-like upside and downside on externalities" that are not incorporated into the firm’s base case analysis.
The research firm acknowledged significant potential for investors with higher risk tolerance, stating that "for investors that like to swing for the fence, the upside optionality is substantial."
Frontier Group, an ultra-low-cost carrier based in the United States, operates a fleet of Airbus aircraft serving destinations across the U.S., Mexico, and the Caribbean.
In other recent news, Frontier Group Holdings reported a second-quarter net loss of $0.31 per share, missing analysts’ expectations of a $0.28 loss per share. The company’s revenue for the quarter was $929 million, slightly below the forecasted $943.78 million. This earnings miss and revenue shortfall have drawn attention from investors. Deutsche Bank upgraded Frontier Group Holdings from Hold to Buy, raising its price target to $8.00 from $4.00, citing the airline’s potential benefits from Spirit Airlines’ bankruptcy due to network overlap.
Frontier Airlines also launched a promotional sale, offering roundtrip fares starting at $38 to various destinations in the U.S., Caribbean, and Latin America. This limited-time offer is available through August 21, 2025, with travel dates between September 2-30, 2025. Additionally, Frontier announced a promotion allowing loyalty program members from select rival airlines to purchase Frontier Elite Gold status for $69, providing premium benefits through December 2026. These recent developments highlight Frontier’s strategic moves amid a challenging financial quarter.
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