LONDON (ShareCast) - (Sharecast News) - Analysts at Berenberg lowered their target price on low-cost carrier Wizz Air from 3,300.0p to 3,200.0p on Friday, stating recent capacity rationalisation was aiding unit revenues for the summer.
Berenberg said Wizz Air's recent five percentage point cut in second-quarter capacity to 130% of 2019 levels, as well as the tempering of growth through winter, represented "a step in the right direction" from management.

"Where it seemed the restoration of asset utilisation was the sole priority earlier in the year, rather than route-level profitability, improved discipline is now being observed," said Berenberg.

The German bank, which reiterated its 'buy' rating on the stock, stated that slower growth was feeding into stronger pricing and said it should also accommodate the restoration of operational reliability.

"We model unit revenues for Q2 being circa 10% ahead of 2019 levels (as guided) but see upside to this if September remains in line with July and August (running at c11% above 2019). We increase EBIT estimates for FY23E slightly, driven mainly by stronger pricing, but take net income for the year down to account for more non-cash balance sheet revaluations," said the analysts.





Reporting by Iain Gilbert at Sharecast.com

Email this article to a friend

or share it with one of these popular networks:

• DIGG
• FACEBOOK
• STUMBLEUPON
• MIXX
• YAHOO BUZZ
• DELICIOUS
• REDDIT
• NEWSVINE