Saker Aviation Services, Inc. (SKAS) stock intrinsic value fair value estimate & owner earnings analysis

Saker Aviation Services spent nearly its entire history operating the Downtown Manhattan Heliport in New York City under a concession from the city, supplemented by a smaller airport-services operation in Kansas. That heliport business is now gone: New York City's economic development corporation notified Saker in November 2024 that it intended to award the concession to a competing operator, and terminated Saker's agreement effective March 29, 2025. Saker vacated the heliport that day. The heliport had been the source of the large majority of the company's revenue and virtually all of its profit for over a decade, so the years of earnings history that precede its loss describe a business that essentially no longer exists, and we have not used them to set the value of the company going forward. Saker has filed suit against the city, alleging the competing operator misrepresented itself to win the concession, and is asking a court to annul that award. That case is still working through the courts. We think it is impossible to responsibly assign a dollar value to a pending lawsuit's outcome, so none of the three cases below assumes any recovery from it; it is best thought of as a free option on top of our estimates, not a floor under them, and a costly loss - beyond the legal fees already being spent - is not something the filings let us size either. In its place, since December 2025 Saker has begun providing financial advisory services, and ended 2025 with exactly one paying client for that new business. It is too early to know whether this becomes a real, scaled business or stays a token effort. What the company does have is a strong balance sheet: essentially no debt, and about $8.5 million of cash and short-term investments as of its most recent quarterly report (roughly $8.37 for each of the company's approximately 1.0 million shares). The main open question for an investor is not whether that cash exists - it plainly does, and there is no solvency concern here - but what happens to it: whether it slowly gets spent down covering the ordinary costs of running a small public company while a new, unproven business tries to find its footing, or whether it is preserved and eventually put to productive use. Management has said only that it is 'assessing various strategic alternatives,' without naming one. We built three cases around that question rather than around a growth forecast, because there simply isn't a demonstrated business to extrapolate yet. The bear case assumes the advisory business never grows past its first client, and that the legal costs of pursuing the heliport lawsuit continue at roughly the pace seen in the company's most recent quarterly filings - a materially heavier drag than the underlying cost of just being a public company - for the next several years. Under those assumptions we get to roughly $2.35 per share, meaning a meaningful piece of today's cash cushion gets spent before anything replaces it. The base case assumes the litigation-related costs moderate over the next year or two (the sharp improvement already visible in the company's second-quarter 2026 results is a real, filed data point, even though it is only one quarter and we have not simply extrapolated it), leaving the roughly $550,000 a year the company has been spending on ordinary corporate overhead - audit, legal, insurance, board and officer costs - as the main ongoing drag, with the advisory business still not contributing enough to offset it. That produces a value of roughly $4.40 per share. The bull case assumes the advisory pivot succeeds well enough, and the corporate cost base is trimmed enough once the lawsuit is behind the company, that the business roughly breaks even going forward - in which case the company is worth close to its current book value, about $8.37 per share. A few judgment calls affected these numbers. In the historical record we kept in our files (which we are not using to value the company, for the reasons above), we treated the $1.4 million arbitration award Saker paid a former heliport contractor in 2024, a 2022 life-insurance payout following a former president's death, and gains on small asset sales as one-time items rather than ongoing costs or income, consistent with how the company itself described them. Depreciation, stock-based compensation and similar non-cash items were added back and then, where the company was still investing to grow, a portion was treated as the ongoing cost of maintaining rather than growing the business; in the loss years this made no difference because there was no growth capital spending to separate out. What would make this estimate wrong: a favorable outcome in the heliport litigation would add value in every case we haven't credited; an unfavorable one that leaves Saker responsible for costs beyond its own legal fees would not. A public announcement that management plans to return the cash to shareholders, or use it for a disciplined and clearly-priced acquisition, would argue for a higher value than any of our cases; a disclosed decision to fund a speculative new venture with it would argue for a lower one. And if the advisory business either disappears entirely or turns out to be growing faster than the single client disclosed at year-end 2025 suggests, both the bear and the bull case would need to move.