Mesa Air Group, Inc.
Mesa Air Group, Inc. (NASDAQ: MESA) is the parent company of Mesa Airlines, Inc., a regional airline based in Northern Kentucky that serves 120 destinations in 42 states, the District of Columbia, the Bahamas, and Mexico. All of its flights are operated as American Eagle, United Express, or DHL Express flights, according to the terms of capacity purchase agreements (CPAs) with its significant partners, American Airlines, Inc. and United Airlines, Inc., as well as a Flight Services Agreement (FSA) with DHL Network Operations (USA), Inc.
Why should Investors make an Exit?
Valuation Methodology: EV/EBITDA Multiple Based Relative Valuation
(Analysis by Kalkine Group)
* % Premium/(Discount) is based on our assessment of the company's FY1 trading multiple after considering its key growth drivers, economic moat, stock's historical trading multiples versus peer average/median, and investment risks.
MESA's stock price has been on a bearish trend throughout the year, fallen 70.53% in the past twelve months and is currently leaning towards the lower band of the 52-week range of USD 3.75 to USD 13.50. We have valued the stock using the EV/EBITDA-based relative valuation methodology and arrived at a target price of USD 3.50.
Considering the fall in fundamentals, industry lagging margins, highly leveraged balance sheet, current valuation, and bearish technical indicators, we recommend a "Sell" rating on the stock at the current price of USD 3.86, down 1.28% as of April 08, 2022, at 6:52 AM PDT.
Three-Year Technical Price Chart (as of April 08, 2022, at 06:52 AM PDT). Source: REFINITIV, Analysis by Kalkine Group
* The reference data in this report has been partly sourced from REFINITIV.
* All forecasted figures and industry information have been taken from REFINITIV