Here's Why Investors Should Avoid SkyWest Stock for Now

SkyWest SKYW is mired in significant challenges arising from increased expenses and weak liquidity. Tariff-related woes are also hurting the company’s prospects, making it an unattractive choice for investors’ portfolios.

Let’s delve deeper.

SKYW: Key Risks to Watch

Southward Earnings Estimate Revision:The Zacks Consensus Estimate for fourth quarter 2025 earnings has been revised 3.9% downward in the past 60 days. Meanwhile, for 2025 and 2026, the consensus mark for earnings has been revised 2.3% and 0.1% downward, respectively, at the same time.

The unfavorable estimate revision indicates brokers’ lack of confidence in the stock.

Dim Price Performance:  SkyWest’s price trend reveals that its shares have fallen 10.7% over the past six-month period against the Transportation - Airline industry’s 22.9% rise.

Weak Zacks Rank: SKYW currently has a Zacks Rank #4 (Sell).

Bearish Industry Rank: The industry to which SkyWest belongs currently has a Zacks Industry Rank of 162 (out of 244). Such an unfavorable rank places it in the bottom 34% of Zacks Industries. Studies show that 50% of a stock’s price movement is directly related to the performance of the industry group it belongs to.

A mediocre stock within a strong group is likely to outclass a robust stock in a weak industry. Hence, reckoning the industry’s performance becomes imperative.

Headwinds: SkyWest faces mounting challenges that continue to weigh on its outlook. Rising costs and weak liquidity are pressuring profitability, with total operating expenses jumping 12% year over year in the third quarter of 2025, driven by 15% increase in block hour production year over year.  

Liquidity remains a key concern, as reflected in SKYW’s persistently weak and volatile current ratio. The ratio declined from 1.04 in 2020 to 0.89 in 2021, rebounded to 1.17 in 2022, and then fell again to 0.90 in 2023, 0.78 in 2024 and 0.71 in the third quarter of 2025. The metric signals ongoing pressure on the company’s ability to meet short-term obligations.

Moreover, SKYW operates in a challenging macroeconomic environment. Economic uncertainty, evolving tariff policies and heightened geopolitical tensions are increasing operational and compliance risks. These conditions are prompting companies to delay investments, reassess forecasts and remain highly agile, adding another layer of uncertainty to SkyWest’s near-term prospects.

Stocks to Consider

Investors interested in the Zacks Transportation sector may consider Expeditors International of Washington EXPD and Global Ship Lease GSL.

EXPD currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

EXPD has an expected earnings growth rate of 3.7% for the current year.  The company has an encouraging earnings surprise history. Its earnings outpaced the Zacks Consensus Estimate in the trailing four quarters, delivering an average beat of 13.9%.

Global Ship Lease currently carries a Zacks Rank #2.

GSL has an expected earnings growth rate of 2.60% for the current year. The company has an encouraging earnings surprise history. Its earnings topped the Zacks Consensus Estimate in the trailing four quarters, delivering an average beat of 16.8%.

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This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research