Though most of its growth was located at the start and end of the year, 2017 still saw the multinational airline rise from £4.45 to £6.50, a 46% surge across the 12 months. The company – which counts British Airways, Aer Lingus and Iberia in its portfolio – initially continued to climb at the start of 2018, with the stock hitting an all-time peak of £6.81 in early January.
However, those highs didn’t last long. A sharp January slump has left the stock ranging between £6 and £6.25, with very few journeys either side of that bracket. International Consolidated Airlines Group now sits at a current trading price of £6.25 (Spreadex, 26/04/2018).
It is perhaps telling that the firm’s full year results towards the end of February couldn’t shake the stock out of it current trading band despite its figures were pretty strong. Passenger revenue rose 1.6% to €20.25 billion, with total revenue jumping 1.8% to €22.97 billion; best was the 19% surge in operating profit to €3.02 billion, an increase that allowed an ‘undaunted’ IAG to announce a €500 million share buyback across the next 2 years. Investors just seem unsure about what kind of long-term benefits CEO Willie Walsh’s ongoing restructuring plan will add.
Heading into next Friday’s update, investors may be looking for some clarification about the firm’s intentions towards Norwegian Air (LON:0FGH) after it took a 4.6% stake in the low-cost carrier in mid-April. As for the figures themselves, IAG will want to see its revenue momentum carried into Q1, as well as a muted impact of rising fuel costs.
International Consolidated Airlines Group S.A. (LON:ICAG) has a consensus rating of ‘Buy’ alongside an average target price of £6.80.
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