Ryanair: stock takes off on broker upgrade
(CercleFinance.com) - Ryanair shares rose almost 4% early on Tuesday in London, after Berenberg upgraded its rating on the Irish airline to "buy," from "hold", having increased its corresponding target price from 15 euros to 20 euros.
In comments on the transport sector, Berenberg said it was more optimistic about the airline sector, while pointing out that the hegemony of the "low-cost" airlines is set to last.
Ryanair's margins and return on capital employed (ROIC) appear to be underestimated based on our analysis of the unit costs of the 210 737 MAX aircraft due to arrive from April, the broker said.
It expects Ryanair's cost leadership to strengthen, enabling it to be the first to break even amongst low-cost carriers, with margins expected to exceed pre-pandemic levels as early as 2024, it adds.
On the stock market, Ryanair shares were up nearly 4% on Tuesday morning. However, the share price has fallen by around 2% YTD.
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The information and analyses distributed by Cercle Finance are only intended as decision-making support for investors. Cercle Finance's responsibility may not be entailed, either directly or indirectly following the use of such information and analyses by readers. Any non-professional investor is recommended to consult a professional advisor before making any investment decision. This indicative information in no way constitutes any invitation to sell or buy securities.
In comments on the transport sector, Berenberg said it was more optimistic about the airline sector, while pointing out that the hegemony of the "low-cost" airlines is set to last.
Ryanair's margins and return on capital employed (ROIC) appear to be underestimated based on our analysis of the unit costs of the 210 737 MAX aircraft due to arrive from April, the broker said.
It expects Ryanair's cost leadership to strengthen, enabling it to be the first to break even amongst low-cost carriers, with margins expected to exceed pre-pandemic levels as early as 2024, it adds.
On the stock market, Ryanair shares were up nearly 4% on Tuesday morning. However, the share price has fallen by around 2% YTD.
Copyright (c) 2021 CercleFinance.com. All rights reserved.
The information and analyses distributed by Cercle Finance are only intended as decision-making support for investors. Cercle Finance's responsibility may not be entailed, either directly or indirectly following the use of such information and analyses by readers. Any non-professional investor is recommended to consult a professional advisor before making any investment decision. This indicative information in no way constitutes any invitation to sell or buy securities.