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Feb 5 2018, 07:50 GMT
Ryanair has announced a new €750m share buyback, bringing total funds returned to shareholders since 2008 to over €6bn – testament to the cash generative nature of the model. The Q3 result (net income of €105.6m, +12%; EPS +17%) is modestly ahead of our €97.8m estimate (consensus: €101m), with FY 2018 guidance maintained at €1.4-1.45bn net income. While costs will rise next year (>€300m in fuel costs and a further €100m added to staff costs), these were as expected and we believe that the competitive advantage Ryanair has in the market will be maintained, indeed enhanced as it continues to roll out its high volume (138m customers) low fares model. Our current price target is €18 and we remain ‘Outperform’. We expect to leave our forecasts broadly unchanged.