Sun Country Airlines Holdings, Inc

Sun Country Airlines Holdings, Inc. (NASDAQ: SNCY) is a hybrid low-cost airline that leverages a shared operating platform across its scheduled passenger services, charter operations, and cargo business. The company primarily caters to leisure and visiting friends and relatives (VFR) travelers, serves charter clients, and provides crew, maintenance, and insurance (CMI) services to Amazon.com Services, LLC, operating flights across the United States as well as to destinations in Canada, Mexico, Central America, and the Caribbean.

As per Global Travel and Leisure Report published on ‘SNCY’ on Dec 04, 2025, Kalkine provided an ‘Buy’ stance on the stock at USD 13.83 based on fundamental analysis and the stock price has now moved up by ~ 29.43% since then.

Noted below are the details of support and resistance levels provided in our previous report:

Rationale:

• Takeover Premium Crystallises Near-Term Value: Sun Country Airlines’ equity valuation has been materially uplifted following the announcement of its acquisition by Allegiant, which values SNCY at USD 18.89 per share, implying a ~19.8% premium to its January 9, 2026 close. The consideration structure of USD 4.10 in cash plus 0.1557 Allegiant shares per SNCY share effectively monetises a significant portion of the company’s standalone upside in the near term.
• Value Recognition Shifts from Standalone SNCY to Combined Entity: While the strategic rationale highlights long-term benefits such as network expansion, fleet optimisation, and participation in a larger, more diversified leisure carrier, these advantages are largely expected to accrue at the combined company level, with SNCY shareholders owning only ~33% post-closing. As a result, much of Sun Country’s future upside is now embedded in Allegiant’s equity and execution of post-merger synergies, rather than remaining fully attributable to SNCY as an independent investment.
• Extended Closing Timeline and Execution Risks: The transaction is expected to close only in the second half of 2026, subject to regulatory and shareholder approvals, exposing SNCY shareholders to an extended period of deal-related uncertainty. Forward-looking disclosures highlight risks around integration complexity, potential regulatory conditions, cost overruns, and delayed realisation of projected USD 140 million in annual synergies, which are phased in over three years. With SNCY shares already reflecting much of the announced premium, the risk-reward profile becomes less compelling.
• Market Re-rating Limits Incremental Upside: The announcement-driven rally effectively reprices Sun Country closer to its implied transaction value, reducing the scope for further upside absent competing bids or materially improved deal terms. Given that future earnings accretion, free cash flow expansion, and balance sheet benefits are tied to post-closing integration and synergy delivery, the current valuation appears to discount a favourable outcome.

Valuation (Using Price/Earnings Multiple)

Share Price Chart  

Conclusion

Sun Country Airlines’ shares rallied sharply following the announcement that Allegiant will acquire the company in a transaction valuing SNCY at approximately USD 18.89 per share, representing a nearly 20% premium to its prior close. The deal structure, which includes a mix of cash and Allegiant stock, crystallizes near-term value for Sun Country shareholders and reflects the market’s positive reassessment of SNCY’s standalone valuation. With SNCY holders expected to own about 33% of the combined airline, and the transaction not set to close until the second half of 2026, the immediate price appreciation driven by takeover optimism provides a clear opportunity to lock in gains after a strong post-announcement move.

Considering Allegiant acquisition announcement, with the stock reflecting the implied takeover premium at current price levels, post-merger risk, and heightened volatility a "Sell" recommendation on Constellation Brands, Inc. (NYSE: STZ) has been given at the current market price of USD 17.90 as on 12 January 2026 at 6:46 am PST.

Note 1: Past performance is not a reliable indicator of future performance.

Note 2: The reference date for all price data, currency, technical indicators, support, and resistance level is 12 January 2026. The reference data in this report has been partly sourced from REFINITIV.

Note 3: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above.

Note 4: Target Price refers to a price level which the stock is expected to reach as per the relative valuation method and/or technical analysis taking into consideration both short-term and long-term scenario.

Note 5: ‘Kalkine reports are prepared based on the stock prices captured either from the London Stock Exchange (LSE) and or REFINITIV. Typically, both sources (LSE and or REFINITIV) may reflect stock prices with a delay which could be a lag of 15-20 minutes. There can be no assurance that future results or events will be consistent with the information provided in the report. The information is subject to change without any prior notice.’

Note 6: Dividend Yield may vary as per the stock price movement.