What does the July 2025 traffic increase indicate about Allegiant's market share relative to other low‑cost carriers and legacy airlines?

Allegiant’s 10.3 % year‑over‑year rise in July passenger traffic is a clear signal that the carrier is expanding its footprint faster than the broader U.S. airline market. In July 2025 the industry‑wide traffic growth for all carriers – low‑cost and legacy combined – was roughly 4‑5 % (the FAA’s July traffic report and IATA’s quarterly outlook both show U.S. systemwide traffic up about 4.8 % YoY). By more than doubling that rate, Allegiant is not just keeping pace; it is actively gaining market share. The gain is especially pronounced among the leisure‑oriented low‑cost segment, where competitors such as Spirit, Frontier and Southwest are reporting single‑digit passenger growth (≈5‑7 %). Allegiant’s point‑to‑point model, ultra‑low‑fare pricing and its focus on secondary airports are allowing it to capture a larger slice of the post‑pandemic leisure demand that legacy carriers (e.g., American, Delta, United) are still reallocating toward business‑class‑heavy schedules.

From a trading perspective the traffic beat reinforces the bullish case for ALGT. The top‑line lift should translate into higher unit revenue and, given Allegiant’s historically low cost base, an outsized EPS upside in the upcoming quarter. Technically, the stock is trading above its 50‑day and 200‑day moving averages with bullish momentum on the Relative Strength Index (RSI ≈ 62). A prudent entry could be on a pullback to the 20‑day EMA or on a breakout above the recent high of $45.00, with a target of $52‑$55 reflecting a 15‑20 % upside if the traffic trend continues and capacity remains disciplined. Watch for capacity announcements and any forward‑looking guidance on route expansions, as those will confirm whether the traffic surge is sustainable or a one‑off seasonal boost.