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Mar 25 2020, 06:30 GMT
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||505c|
|Wizz Air Holdings||NEUTRAL||09/09/19||Outperform||20/06/18||2294.0p|
COVID-19 is the biggest crisis the airline industry has faced and it will be different afterwards. We discuss the following themes here: liquidity, consolidation, state intervention and longer-term consequences. Equity values have collapsed, credit spreads have pushed out remarkably and liquidity is king. In Europe, 95% of aircraft have stopped flying. However, our modelling shows that most of the leading airlines’ equity will not be permanently impaired, notably those with asset backing, and there will be opportunities at the end of this. Ryanair and IAG look to be the most secure and we reiterate our ‘Outperform’ ratings.