Silver lining to Atlas Air Worldwide Holdings (NASDAQ:AAWW)’s dark cloud?

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We are going to take a close look at Atlas Air Worldwide Holdings (NASDAQ:AAWW) today to get a better sense of the company and its current status, as well as the opportunity it may offer for prospective investors. Today’s focus will be a fundamental evaluation of the stock from top to bottom.

As such, let’s start with the top line: Revenue trends.

Last quarter, the company saw its overall sales move to $529.73M in total revenues. That represents an overall change in revenues, on a quarterly year/year basis, of 0.11%. If we translate that into sequential terms, the company saw sales grow by 0.15% from quarter to quarter.

While revenue analysis gives us a strong sense of changing demand trends in the company?s end market, and how the company is executing in terms of its relationship with potential customers, real shareholder value is only truly created by profitability.

With this in mind, we turn to the company’s bottom line data.

Atlas Air Worldwide Holdings (NASDAQ:AAWW) is intriguing when broken down to its core data. The cost of selling goods last quarter was $388.35M, yielding a gross basic income of $141.37M. For shareholders, given the total diluted outstanding shares of 25.55M, this means an overall earnings per share of $1.11. Note, this compares with a consensus analyst forecast of $0.96 in earnings per share for its next fiscal quarterly report.

Next, let’s look ahead at coming performance based on what analysts are projecting for the company more generally, before closing with a survey of the balance sheet and cash flow.

At present, analysts hold a consensus average recommendation of Overweight. This is based on a total of 9 analysts? ratings. While we don’t suggest taking analyst recommendations as face value plans for action in a portfolio, we do think it is important to note where consensus is on a stock to understand what basic assumptions are perhaps already discounted into market pricing of shares of the stock.

As far as price targets, analysts currently have an average target on shares of at $63.43. In addition, if we turn to next year, we see estimates of a fiscal year forecast to bring about 5.10 in total earnings per share. On a median price to earnings ratio basis, that outlook adds up to a valuation of 11.15 times earnings.

So far, we have covered how the company is doing on both the top and bottom line, as well as what professional analysts believe about its core trends and operational and financial performance going forward. However, we would be remiss if we did not also take a quick look at cash flows and the company’s balance sheet to round out our perspective on the name.

As the reader is no doubt aware, for any company, balance sheet health sits at the heart of the company’s capacity to stand up to the demands and obligations incurred by normal and contingent operations, which in turn lies at the core of a company’s ability to retain the faith of investors in the marketplace. For Atlas Air Worldwide Holdings (NASDAQ: AAWW), the company presently holds about $138.25M in cash in the coffers. That cash is balanced against about $184.75M in total current liabilities.

It’s important to consider both a static and dynamic picture, particularly where debt levels are concerned. This means, we need to take into account any trends. In this case, the company?s debt has been $growing. The company also has $4.25B in total assets, balanced by $2.73B in total liabilities, which suggests where this story might go under adverse economic or financial conditions.

As far as cash flows, the company saw a free cash flow last quarter of $41.59M, representing a quarterly net change in cash of $22.68M. On a net operating level, the company saw about $131.34M in cash flow.

Atlas Air Worldwide Holdings, Inc. (NASDAQ:AAWW), today announced the ratification of a collective bargaining agreement with the dispatchers of its subsidiaries, Atlas Air, Inc. and Polar Air Cargo Worldwide, Inc. The dispatchers are represented by the International Brotherhood of Teamsters (IBT) Local 210.

We will update the interesting story of Atlas Air Worldwide Holdings (NASDAQ:AAWW) as new events transpire.

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