EasyJet Trading Update – What to Expect

EasyJet (LON: EZJ) will report its half-year results on Tuesday, April 18, and with the stock taking a slight dip in recent weeks, investors will be hoping for renewed momentum.

EasyJet shares are down around 2.5% in the last month, but they have gained over 48% so far this year. 

The company has benefitted significantly from robust European travel demand…

Back in January, in EasyJet’s first quarter update, the low-cost carrier said revenue per seat (RPS) was expected to continue the year-on-year trend from Q1, which grew 36%. 

In addition, EZJ revealed Airline and EasyJet Holidays delivered record revenue booking days in January, while booking strength continued in Q2 and is expected to remain elevated into the summer.

We recently noted that EasyJet demand has risen sharply, with Twitter mentions remaining to the upside and Google searches rising quarter-over-quarter. In addition, website visits, according to Semrush, are also at highs. 

Overall, the signs look positive.

Barclays analyst Andrew Lobbenberg is bullish on the stock. In late March he upgraded it to Overweight from Equal Weight, lifting the firm’s price target on EasyJet shares to 570p from 510p in the process. 

While he acknowledged that macro concerns have weighed on the Europe airlines sector, he believes European travel demand will remain strong through the summer. Lobbenberg also sees airlines benefitting from lower fuel prices and a weaker US dollar.

Meanwhile, in February, Deutsche Bank analyst Jaime Rowbotham double-upgraded easyJet to Buy from Sell, raising the firm’s price target on the stock to 580p from 410p per share.

Rowbotham told investors in a note that the UK economic outlook had “improved dramatically” in the three months prior, representing a positive for easyJet, the airline with the greatest exposure to the UK market.

Our View: Overall, we are optimistic heading into the update, with demand trends in the right direction for EasyJet and other European airlines

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