2023-03-31 07:29:57 ET
Deutsche Bank turned constructive on European airlines on Friday on the view that the material outlook on the sector is improved.
Analyst Jaime Rowbotham said the potential for operating profits in 2023 is now much higher than the firm thought previously despite tailwinds from further disruptions at airports, from air traffic control issues, and from potential labor union actions affecting the peak travel periods. Airlines were noted to be exercising prudence on yields, with DB assuming flat growth year-over-year in Q3 and -5% in Q4. The firm's forecast for operating profits is above consensus estimates.
The positive spin from Deutsche Bank takes Air France-KLM ( OTCPK:AFRAF ) to a Buy rating from Hold, International Airlines Group ( OTCPK:ICAGY ) to a Buy rating from Hold, and Deutsche Leufthansa AG ( OTCQX:DLAKF ) to a Buy rating from Hold.
Read more about the widespread airline and airport worker strikes in Europe.
For further details see:
Lufthansa, IAG and Air France-KLM land buy ratings at Deutsche Bank despite strikes, disruption