Airlines Wizz Air and IAG were upgraded at BofA on Thursday.

BofA analyst Muneeba Kayani upgraded IAG to Buy from Neutral and kept a 200p price target on its shares, with the analyst stating that while she expects a slow start for European airlines in 2023, she anticipates a recovery in Q2.

Furthermore, Kayani said to investors in a research note that she expects demand for European airlines to surprise to the upside, and despite balance sheets being stretched, the sufficient liquidity and potential acquisitions justify a bullish case for the sector.

IAG is currently trading over 24% higher over the last three months, following a period of difficulty for its shares.

Kayani upgraded Wizz Air shares to Buy from Neutral, assigning the stock a 3,200p price target.

Wizz Air has gained over 20% over the last three months, with surging demand over the summer months providing a boost for shareholders, despite the macroeconomic headwinds.

Wizz Air is currently up 1.17% on Friday, whilst IAG has gained 0.51%.

However, Kayani was not bullish on all airlines and downgraded easyJet from Buy to Underperform. The analyst kept a 340p price target on the low-cost carrier’s shares and stated that easyJet is the only airline under coverage where unit costs are seen staying above pre-pandemic levels.

easyJet shares have struggled recently, only recovering 6% over the last three months.