Acute supply constraints underpin pricing optimism – our 2020 vision

  • Sectors : Airlines
  • Companies : Lufthansa | easyJet | Air France KLM | IAG | Wizz Air Holdings | Ryanair Holdings | Norwegian Air


Ratings and price correct at time of issue

Company Rating Date Previous Rating Date Closing Price
Air France KLM NEUTRAL 20/01/20 Outperform 21/01/19 983c
easyJet NEUTRAL 20/06/18 Outperform 12/12/17 1480p
IAG OUTPERFORM 31/08/18 Neutral 22/08/17 677.8p
Lufthansa NEUTRAL 30/10/18 Outperform 27/01/17 1528c
Norwegian Air NEUTRAL 01/09/15 Underperform 22/01/15 4220nok
Ryanair Holdings OUTPERFORM 07/12/09 Neutral 02/11/09 1572c
Wizz Air Holdings NEUTRAL 09/09/19 Outperform 20/06/18 4260.0p


The European airlines space is on an improving trajectory, both structurally and cyclically. The unwind of Brexit risk has aided sector valuations in recent months, and we believe supply constraints will drive further operating leverage into the summer season. The ‘tail’ in Europe is barely breakeven and we see inefficient capacity being pushed from the market in the medium term. We retain our ‘Outperform’ ratings on IAG and Ryanair – the structural winners.

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Jan 20 2020, 06:30 GMT