By Scott Kanowsky
Investing.com -- Shares in Ryanair (LON:RYA) Holdings PLC (IR:RYA) jumped on Thursday after the budget airline raised its annual profit outlook thanks to a surge in holiday travel demand.
Ryanair said full-year after-tax income is now seen at €1.33 billion to €1.43 billion (€1 = $1.0623), up from its prior guidance of €1B to €1.2B, while total annual customers are anticipated to come in at 168M - marginally under Bloomberg consensus estimates of 168.1M.
The carrier said the bump up in its profit target stemmed from a stronger-than-expected third-quarter performance that was fueled by pent-up post-pandemic passenger traffic over the Christmas and New Year period.
However, Ryanair warned that it expects the fourth quarter to be loss-making due in part to the absence of the Easter holiday from March and a "softening" in U.K. outbound traffic and pricing.
The company also flagged that its updated annual earnings estimate is "heavily dependent" on COVID-19 and the war in Ukraine not affecting returns in the final three months of its current financial year.
Analysts at Liberum upgraded their recommendation for Ryanair to buy from hold, calling the firm's statement a "positive" development. They noted that the new full-year net profit guidance represents a 25% increase to the midpoint of its previous target.
Ryanair will release its full third-quarter results on January 30.