Volaris: Strong Buy While It's On Discount

Summary

• Despite a 50% share price drop, I maintain Volaris as a Strong Buy due to its deep undervaluation and long-term growth prospects.
• Short-term headwinds include GTF engine issues extending to 2027, temporary demand weakness, and recent quarterly losses, but these are not permanent setbacks.
• Volaris' young, fuel-efficient fleet and significant stored capacity position it for strong revenue and earnings growth once operational constraints ease.
• Risks remain around timing and market sentiment, but I see Volaris as a 'when, not if' story with substantial upside for patient investors.

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I first wrote about Volaris (NYSE:VLRS) in January of 2025, and since then - despite saying the company was deeply undervalued, its share price has dropped by ~50%. I'm certainly not pleased, especially because in these six months I've made Volaris one of

Analyst’s Disclosure:I/we have a beneficial long position in the shares of VLRS either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.