Air France-KLM: share rises on JPMorgan double upgrade

(CercleFinance.com) - Air France-KLM shares rose sharply on Wednesday's trading on the Paris Bourse, with JPMorgan doubling its recommendation on the airline from 'Underweight' to 'Overweight'.


At around 12:30 p.m., Air France-KLM shares were the biggest gainers on the SBF 120 index, taking off over 7%, while the overall index lost 0.3% at the same time.

In a sector study, JPMorgan sees a possible "inflection point" in the results of the Franco-Dutch carrier, whose share price has fallen by 40% this year to historic lows.

Its target price of E12.5 represents around 40% upside potential.

JPMorgan points out that underlying fares (excluding the Olympic Games) seem to be holding up well, and growth in route capacity in line with the market looks likely during the winter season.


Combined with lower kerosene prices and the disappearance of the exceptional items that weighed on the accounts last year, the research firm is counting on a "decent" improvement in margins next year, leading it to post an operating profit (Ebit) forecast 12% higher than the average consensus estimate for 2025.

Contacted by Cercle Finance, market participants also mentioned an encouraging business update from British online travel agency On The Beach, which comes on the heels of optimistic statements from German tourism group TUI.

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