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Jan 24 2022, 06:45 GMT
Airlines
Airlines in 2022 – like a coiled spring
- Sectors : Airlines
- Companies : Lufthansa | easyJet | Air France KLM | IAG | Wizz Air Holdings | Ryanair Holdings | Norwegian Air
Ratings
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 | 396c |
| easyJet | OUTPERFORM | 24/01/22 | Neutral | 14/07/21 | 630p |
| IAG | NEUTRAL | 12/08/20 | Outperform | 31/08/18 | 159.3p |
| Lufthansa | OUTPERFORM | 24/01/22 | Underperform | 08/06/20 | 688c |
| Norwegian Air | NEUTRAL | 01/09/15 | Underperform | 22/01/15 | 1155nok |
| Ryanair Holdings | OUTPERFORM | 07/12/09 | Neutral | 02/11/09 | 1662c |
| Wizz Air Holdings | UNDERPERFORM | 21/04/21 | Neutral | 09/09/19 | 4523.0p |
DAVY VIEW
Airline stocks are early cyclical and should outperform in periods of margin expansion. We favour LCCs but relative performance will be nuanced. With market capacity down >10% this summer and geographical bias to Ireland/UK, we favour Ryanair (PT increased to €19) and easyJet (‘Outperform’ from ‘Neutral’, PT £7.2). Of the networks, Lufthansa’s balance sheet is strongest, with cargo promising and Lufthansa Technik undervalued (‘Outperform’ from ‘Underperform’, PT €8m). Demand recovery could be dramatic, but airlines are still sensitive to geopolitical events, seven-year-high oil prices and rising carbon costs.
