Shares in easyJet (LON:EZJ) have fallen into the red in today’s session, even as Liberum lifted its stance and price target on the blue-chip carrier. Proactive Investors reports that the analysts argue that “supportive short-term trading outweighs cost concerns, for now”.
As of 09:51 BST, easyJet’s share price had given up 1.32 percent to 1,755.00p, underperforming the broader UK market, with the benchmark FTSE 100 index currently standing 0.54 percent lower at 7,699.16 points. The group’s shares have added just under 31 percent to their value over the past year, as compared with about a 2.6-percent rise in the Footsie.
Liberum lifts stance on easyJet
Liberum upgraded its rating on easyJet to ‘hold’ today, while lifting its price target on the shares from 1,250p to 1,800p. Proactive Investors, however, quoted the analysts as saying in a note to clients that they remained concerned about the blue-chip carrier’s unit cost trends, noting that there was “still structural upward pressure on non-fuel costs”. The broker nevertheless reckons that the group’s management “seems to be switching focus from cost mitigation to better revenue per seat”.
“The 2019 unit cost target has been shelved. In the short term, a supportive trading environment, with competitors cutting capacity on easyJet's routes, is supportive for earnings, margins and the rating,” Liberum concluded, as quoted by the newswire.
Other analysts on budget carrier
Deutsche Bank, which has a ‘neutral’ rating on the blue-chip carrier, set a price target of 1,915p on the shares yesterday, while Numis, which sees easyJet as a ‘hold,’ lifted its valuation on the stock from 1,508p to 1,838p. According to MarketBeat, the budget airline currently has a consensus ‘hold’ rating and an average price target of 1,727.88p.
UBS trimmed its stance on easyJet last month, pointing to the airline’s ‘insufficient share and earnings upside’.