Positive thesis unchanged, even if recovery is moving to the right; inflection point is coming

  • 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 503c
easyJet OUTPERFORM 22/01/21 Neutral 19/11/20 987p
IAG NEUTRAL 12/08/20 Outperform 31/08/18 210.2p
Lufthansa UNDERPERFORM 08/06/20 Neutral 30/10/18 1078c
Norwegian Air NEUTRAL 01/09/15 Underperform 22/01/15 5940nok
Ryanair Holdings OUTPERFORM 07/12/09 Neutral 02/11/09 1608c
Wizz Air Holdings UNDERPERFORM 21/04/21 Neutral 09/09/19 4877.0p


We see an ‘inflection point’ coming. Despite the noise, we believe that Mediterranean countries will open in scale for peak/late summer. While the transatlantic could open by mid-May, traffic levels will be subdued, certainly eastbound. Corporate/emerging markets will be further behind. We prefer low-cost carriers (LCCs), given their nimbler route deployment, over network carriers. We favour Ryanair (‘Outperform’, price target €18, unchanged) and easyJet (‘Outperform’, price target up to £10.8) but downgrade Wizz to ‘Underperform’ on the basis of valuation. Among the networks, we still favour IAG (‘Neutral’), with both continental groups (Air France-KLM and Lufthansa) continuing remedial work on their capital structures.

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Apr 21 2021, 06:30 IST/BST