NEW YORK (TheStreet) -- Shares of Spirit Airlines (SAVE) - Get Report are falling 2.5% to $42.63 this afternoon ahead of the company's 2016 second quarter earnings report, due out tomorrow before the opening bell.
Analysts surveyed by Thomson Reuters expect the company to report earnings of $1.08 per share on revenue of $587.1 million. In 2015, the company reported adjusted earnings of $1.03 per diluted share and revenue of $553.4 million for the second quarter.
Following a recent investor update from the company in mid-July, analysts at Stifel said it is getting "harder to defend" a bull case for the Miramar, FL-based budget airline.
"Bottom line is that Spirit needs to start showing an improvement in PRASM in the third quarter or estimates are likely to come down considerably," the firm added in a note cited by Barron's.
JPMorgan said in a separate note that the company is on the decline due to fare discounting. "Spirit cited a greater than anticipated level of fare discounting than typical at the summer peak, a fact which somewhat surprises us given two broad-based fare increases during the quarter," the firm noted.
Spirit recently unveiled a low-cost service in Ohio at Akron-Canton airport. This is the 57th U.S. city to join the company's expanding network, according to a company statement.
Separately, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.
TheStreet Ratings rated this stock as a "buy" with a ratings score of B-.
The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, expanding profit margins, good cash flow from operations and notable return on equity. TheStreet Ratings feels its strengths outweigh the fact that the company has had lackluster performance in the stock itself.
You can view the full analysis from the report here: SAVE