Norwegian Air

Q1 successfully navigated, but structural issues remain

  • Sectors : Airlines
  • Companies : Norwegian Air

Ratings and price correct at time of issue.

  • Norwegian Air

    Closing Price: nok28100

  • RATING 22/01/15

  • PREVIOUS RATING N/A

DAVY VIEW

Norwegian has successfully navigated a difficult Q1, likely prompting modest upgrades that will reverse the FX- and strike-related downgrades through the year-to-date. It is also encouraging that its long-haul operations have good momentum and that bookings have returned following the strike. However, our long-term structural concerns – that the capacity growth to come will be difficult to absorb with a lack of competitive advantages and that leverage is by far the highest in the sector – remain. In addition, the equity ratio has now fallen to just 7% (from 9% at end-2014 and 24% on average from 2005-2013).

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Apr 29 2015

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