Ryanair: Keeping Costs Steady While Investing In Growth

2025-02-23 00:55:58 ET

Summary

• Ryanair epitomizes the ‘budget airline’ business model, boasting some of the highest efficiency and operational metrics amongst its peers, like its 93.5% load factor (FY24).
• Two years clear of the initial impact of COVID-19, Ryanair is rapidly growing its already dominant reach, with a 3-year revenue CAGR in excess of 54%.
• A considerable investment in fleet expansion, seeking to increase their aircraft from 609 to 900 by 2034, underpins their growth strategy.
• The combination of an aggressive capacity push paired with industry-leading cost management yields an attractive investment opportunity.
• Ryanair trades at relatively cheap multiples, with an LTM EV/EBIT of 12.73x vs a select peer group average of 28.55x and median of 17.79x.

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