Wizz Air gains after Deutsche Bank pulls bear rating (OTCMKTS:WZZAF)
Deutsche Bank said it sees some light at the end of the runway for Wizz Air (OTCPK:WZZAF) after having a bearish view on the European airline stock.
Analyst Jaime Rowbotham said the prior downgrade on Wizz Air (OTCPK:WZZAF) was due to fears that the December quarter results might act as a negative catalyst for the shares, and concerns that GTF compensation might be unable to offset a deterioration in underlying trading, putting consensus estimates at risk.
Rowbotham said FQ3 unquestionably turned out to have been a very tough quarter and while Wizz has underperformed easyjet plc (OTCQX:EJTTF) and Ryanair (RYAAY) by 7% and 3% respectively over the period in question, Wizz shares have nonetheless risen by 8% in absolute terms since December 4th in comparison to the STOXX index. Working in Wizz’s favor, he noted the still very supportive backdrop in terms of supply and demand for intra-EU leisure and VFR travel in 2024, as evidenced by the outlook commentary from all of the low-cost carriers during recent reporting. He also said fare analysis by Deutsche Bank looked positive for the airline company, and a better-than-expected outlook from Wizz in terms of how actions taken and compensation from Pratt & Whitney can potentially mitigate GTF engine issues over the next 12 months.
Deutsche Bank moved to a Hold rating on Wizz Air (OTCPK:WZZAF) after having the airline stock slotted at Sell.
Shares of Wizz Air (OTCPK:WZZAF) rose 2% in London during afternoon trading.
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