Ok, let’s talk about Mesa Air Group, Inc. (NASDAQ: MESA), the only airline carrier company I am aware of, that has been running successfully through the pandemic posting profit during these difficult times. Interestingly enough, they are a publicly listed company, and as such that we can be part of it.
What do they do?
Well, Mesa Airlines operates a large fleet of regional jets and narrow-body aircraft on behalf of their partners. They fly the CRJ-900 as American Eagle, the Embraer E175 as United Express, and the Boeing 737 as DHL Express. Their partners sell the tickets and load the cargo, but they provide the aircraft, crew, and maintenance. It is an interesting business model that can generate lots of profit if operated properly. Mesa has 6 hubs and 147 carriers with 625 daily departures. These numbers are impressive. But is that sufficient for me to invest in this company?
Absolutely not!. As always when we look into the high growth or blue-chip companies, we should look into their fundamentals and Mesa’s fundamentals are amazing.
Summary of fundamental Financials
MESA’s current Share Price is $11.66, but the book value per share is $13.63. Meaning, the stock is 14% cheaper than its true value. So the company is undervalued in the public market. If you are a value investor, you can close your eyes and buy this stock. But remember, this is not just a value stock; it is a high growth stock too. We are aiming at two birds with a single stone here.
Furthermore, the company made more than $500million in revenue thought out during this pandemic. But its market capitalization is less than $400million. This is an absolute steal. Check the ratios; I am sure you will find it a strong buy call. If you don’t believe me, refer below.
Mesa Air Group, Inc. (NASDAQ: MESA) will release its second-quarter earnings for the fiscal year 2021 after the market closes on Monday, 10th May. The company will also host a conference call to discuss the results on the same day at 4:30 pm EST
What I am expecting from the Q2 earnings?
Well, it is difficult to say at this point. But I do trust they will post decent earnings this time too. Although their Q1 results were impressive, it was not as expected though. They had to cancel many flights in the last quarter. I hope they had caught up with their schedule for this quarter. Even if they fail to post a positive result, I don’t see the stock tanking below $10 considering its strong fundamentals. Besides, I am monitoring continuous buying from a single entity every time there is a slight drop in the price. It must be an institution and if so, is a very good sign.
The following are few updates from the Stocknews website
- Value is the dimension where MESA ranks best; there it ranks ahead of 96.36% of US stocks.
- The strongest trend for MESA is in growth, which has been heading up over the past 193 days.
- MESA ranks lowest in stability; there it ranks in the 11th percentile.
Sounds impressive, right? Read this too.
- Of note is the ratio of Mesa Air Group Inc’s sales and general administrative expense to its total operating expenses; 99.29% of US stocks have a lower such ratio.
- The ratio of debt to operating expenses for Mesa Air Group Inc is higher than it is for about 96.64% of US stocks.
- In terms of volatility of its share price, MESA is more volatile than 94.82% of stocks we’re observing.
So, don’t you think this is a stock that you simply cannot afford to miss? Reflect on the information we have provided and do your own research.
What am I planning to do?
I am yet to open a position. I have my ISA in Freetrade, and this stock is not listed on their platform. That’s my bad. I feel as if I am missing Trading 212 and should back to T212 soon. At least leverage the ISA services of T212. Nevertheless, I will buy MESA in one of my trading accounts soon. If their earnings call on the 10th aren’t good enough and the price dropped, I will load my position extensively.
I consider this as a high-growth stock. 2x is highly possible with the proper coverage and exposure. However, for the short term, I set my target as $16.
That’s all folks.
Pre-Market looks not so bad today. Let’s hope for a good day and play safe.