IAG returns to reign in the Ibex this Friday, as has been usual throughout the last days and contrary to what has been seen during the rest of the year. And it is that, since things have been improving regarding the coronavirus, and as the economies have reopened, the airlines have also been recovering on the stock market. In the specific case of IAG, the words spoken by Pedro Sánchez during the weekend of May 24 and 23, when the Prime Minister, have benefited in this regard He announced that foreign tourists will be able to come to our country from July 1.
Deutsche Bank experts publish a report on IAG this Friday entitled "A credible first recovery cycle". In the opinion of these analysts, IAG – for which they have a 'buy' advice – offers right now "an interesting entry point".
According to the German bank, IAG's business has potential for recovery. "We estimate that revenues will return to pre-crisis levels (approximately 25.5 billion euros) in 2024 and margins in 2025. We also see possibilities for IAG to recover its pre-crisis free cash flow levels, with 2,600 million euros by 2025 ", they explain.
Two months ago, Deutsche Bank revised its estimates on IAG applying the impact of Covid-19. Thus, it now estimates an annual traffic drop of 50% this year, while it will drop 10% in 2021 and 5% in 2022. In addition, Deutsche cut its profit forecast and target price, (from 685 pence up to 400 pence). "Today we are applying a much more cautious traffic scenario, primarily due to our concerns about the possible slower recovery in long-distance and business travel," these analysts conclude.
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