Why SkyWest’s latest earnings matter for shareholders

SkyWest (SKYW) just released fourth quarter and full year 2025 results, pairing higher revenue with slightly softer quarterly earnings per share. The company also locked in long term E175 flying agreements with United and Delta, which define its future cash flows.

SkyWest’s latest earnings release and the confirmation of long term E175 contracts came alongside some share price volatility, with a 1 day share price return of 4.03% and a 1 year total shareholder return of 15.04%. Over a 3 year period, the total shareholder return is about 4.4x.

If this earnings story has you looking at airlines more broadly, it could be a useful moment to scan aerospace and defense stocks for other aviation related ideas that stand out on your radar.

So with SkyWest trading at a discount to analyst targets and to the industry P/E, yet coming off a 3 year total return of about 4.4x, are you looking at a genuine value opportunity, or a stock where the market already sees the future baked in?

Most Popular Narrative: 21.8% Undervalued

The most followed narrative places SkyWest’s fair value at about $128.33 per share versus the last close of $100.41, framing today’s price as a discount to modeled future cash flows.

Fleet modernization through significant orders of new, fuel efficient E175 aircraft under long term, flexible contracts is expected to improve cost structure, enhance asset utilization, and boost net margins as newer planes replace older, less efficient models and support new multiyear agreements with major carriers.

Want to see what kind of revenue rhythm, margin shape, and future earnings multiple have to line up for that valuation to make sense? The narrative lays out a specific growth path, a tighter profit profile, and a higher future P/E that all have to work together. If you care about how those pieces fit, the full story is worth a close read.

Result: Fair Value of $128.33 (UNDERVALUED)

However, this depends on SkyWest managing pilot shortages and its heavy reliance on capacity purchase agreements, either of which could pressure margins and earnings stability.

Build Your Own SkyWest Narrative

If the assumptions behind this story do not quite fit how you see SkyWest, you can review the same data yourself and build a fresh narrative in just a few minutes. To begin, start with Do it your way.

A great starting point for your SkyWest research is our analysis highlighting 4 key rewards and 2 important warning signs that could impact your investment decision.

Looking for more investment ideas?

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.