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Jan 22 2021, 06:30 GMT
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|
|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.