Sky darkest before dawn – sun set to rise for short-haul summer

  • 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 UNDERPERFORM 11/05/20 Neutral 20/01/20 481c
easyJet OUTPERFORM 22/01/21 Neutral 19/11/20 826p
IAG NEUTRAL 12/08/20 Outperform 31/08/18 160.0p
Lufthansa UNDERPERFORM 08/06/20 Neutral 30/10/18 1036c
Norwegian Air NEUTRAL 01/09/15 Underperform 22/01/15 6772nok
Ryanair Holdings OUTPERFORM 07/12/09 Neutral 02/11/09 1560c
Wizz Air Holdings NEUTRAL 09/09/19 Outperform 20/06/18 4474.0p


Europe is in lockdown; fear pervades; and airline booking levels are opaque. We look further out, however, and are optimistic about the point-to-point leisure market reawakening just in time for peak summer. The rollout of vaccines, testing requirements and the possible introduction of biometric passports are key themes. With leverage to leisure, strategic advantages and undemanding valuations, Ryanair (price target increased to €18.0) and easyJet (upgrading to ‘Outperform’) are our favoured stocks. Air France-KLM and Lufthansa (both ‘Underperform’) have unfavourable revenue mixes and meaningful, lasting restructuring still to do, and both need to carry out remedial work on their capital structures.

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Jan 22 2021, 06:30 GMT