Deutsche Bank Research has downgraded Wizz Air Holdings Plc (LSE:WIZZ) from “buy” to “hold,” lowering its price target to 1,400 pence from the previous 1,500 pence.
Analyst Jaime Rowbotham highlighted that the airline’s first-quarter results, released in July, showed revenue per available seat kilometer (RASK) remained flat compared to the same period last year.
“Despite lower last-minute fares during the summer peak, the outcome is expected to align broadly with prior projections,” Rowbotham noted.
On the cost side, Wizz Air had anticipated improvements in non-fuel costs per available seat kilometer in Q2, following a 14% increase in Q1. Deutsche Bank now expects a 1% year-on-year decline for the quarter, down from the previously forecast 2% rise. This adjustment accounts for lower disruption costs and the delayed timing of maintenance expenditures.
As a result, the bank raised its pre-tax and foreign exchange profit estimate for Q2 to €338 million from €296 million. However, a one-off tax charge is projected to offset these gains, reducing the after-tax profit forecast to €240 million from €252 million.
This content is for informational purposes only and does not constitute financial, investment, or other professional advice. It should not be considered a recommendation to buy or sell any securities or financial instruments. All investments involve risk, including the potential loss of principal. Past performance is not indicative of future results. You should conduct your own research and consult with a qualified financial advisor before making any investment decisions.
Leave a Reply