Shares easyJet (LON:EZJ) have jumped in London in today’s session, outperforming the broader UK market, as analysts at Credit Suisse turned bullish on the low-cost carrier. The broker sees recovery in profitability to the levels seen in 2013 and 2014 on the cards.
As of 14:44 BST, easyJet’s share price had added 4.45 percent to stand at 1,407.00p, outperforming the broader UK market, with the benchmark FTSE 100 index currently 0.10 percent better off at 7,344.94 points. The group’s shares have added more than 34 percent to their value over the past year, and are up by just under 40 percent in the year-to-date.
Credit Suisse lifted their stance on easyJet from ‘neutral’ to ‘outperform’ today, flagging recovery in the airline’s profitability to the levels seen in 2013 and 2014 on the back of more moderate competitive growth, a normal winter securing recovery in 2018 and the existence of growth opportunities.
Sharecast reported that the broker had lifted its estimates for the company's revenues per seat, due to improved summer trends, from -2 percent and -4 percent for the third and fourth quarters of 2017, respectively, to -1 percent and -3 percent.
That in turn has driven a seven-percent increase in their estimate for easyJet’s 2017 profit before tax (PBT) to £420 million. Credit Suisse further lifted its estimate for the airline’s 2018 PBT by 17 percent to £534 million.
The upbeat comments come after easyJet updated investors on its traffic statistics yesterday, reporting that it had carried 7.7 million passengers last month, marking an 11.3-percent increase on the prior-year period.
The 23 analysts offering 12-month price targets for easyJet for the Financial Times have a median target of 1,205.00p, with a high estimate of 1,600.00p and a low estimate of 900.00p. As of July 4, the consensus forecast amongst 27 polled investment analysts covering the blue-chip carrier advises investors to hold their position in the company.