Critical Survey: International Consolidated Airlines Group (OTCMKTS:BABWF) versus Frontier Group (NASDAQ:ULCC)

Frontier Group (NASDAQ:ULCC) and International Consolidated Airlines Group (OTCMKTS:BABWF) are both transportation companies, but which is the better stock? We will compare the two businesses based on the strength of their analyst recommendations, profitability, earnings, dividends, valuation, risk and institutional ownership.

Analyst Recommendations

This is a breakdown of recent ratings and target prices for Frontier Group and International Consolidated Airlines Group, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Frontier Group	1	9	1	0	2.00
International Consolidated Airlines Group	0	0	0	0	N/A

Frontier Group presently has a consensus target price of $5.77, suggesting a potential downside of 16.50%. Given Frontier Group’s higher probable upside, research analysts clearly believe Frontier Group is more favorable than International Consolidated Airlines Group.

Institutional and Insider Ownership

39.6% of International Consolidated Airlines Group shares are held by institutional investors. 81.5% of Frontier Group shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Earnings & Valuation

This table compares Frontier Group and International Consolidated Airlines Group”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Frontier Group	$3.59 billion	0.43	-$11.00 million	($0.29)	-23.83
International Consolidated Airlines Group	N/A	N/A	N/A	$0.38	6.96

International Consolidated Airlines Group has lower revenue, but higher earnings than Frontier Group. Frontier Group is trading at a lower price-to-earnings ratio than International Consolidated Airlines Group, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Frontier Group and International Consolidated Airlines Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Frontier Group	-1.77%	-4.09%	-0.40%
International Consolidated Airlines Group	N/A	N/A	N/A

Summary

International Consolidated Airlines Group beats Frontier Group on 6 of the 10 factors compared between the two stocks.

About Frontier Group

Frontier Group Holdings, Inc., provides low-fare passenger airline services to leisure travelers in the United States and Latin America. The company sells its products through direct distribution channels, including its website, mobile app, and contact centers. As of December 31, 2023, it had a fleet of 136 Airbus single-aisle aircrafts. Frontier Group Holdings, Inc. was founded in 1994 and is headquartered in Denver, Colorado.

About International Consolidated Airlines Group

International Consolidated Airlines Group S.A., together with its subsidiaries, engages in the provision of passenger and cargo transportation services in the United Kingdom, Spain, the United States, and rest of the world. It also provides aircraft leasing, aircraft maintenance, tour operation, air freight operations, call centre, ground handling, trustee, retail, IT, finance, procurement, storage and custody, aircraft technical assistance, human resources support, and airport infrastructure development services; and manages airline loyalty programmes. The company operates under the British Airways, Iberia, Vueling, Aer Lingus, and LEVEL brands. It operates a fleet of 582 aircrafts. The company was incorporated in 2009 and is headquartered in Harmondsworth, United Kingdom.