IAG’s annual increase was already historic a few weeks ago, but now it wins a new award. For the first time on the stock market, the Spanish-British airline manages to double its market value in a year. That is, scoring increases of 100%. An Ibex 35 company has not risen this much since 2020.
In the year of the pandemic, Solaria shares achieved gains of more than 247%. Since then, no company on the main Spanish index had managed to advance so much in a year. In 2021, Rovi won the selective of the 35 with increases of almost 93%. In 2022, with the start of the interest rate rise in the eurozone, CaixaBank was the most bullish with a revaluation of more than 50%. Last year, the pharmaceutical company once again revalidated the title of Ibex 35 champion with new increases of almost 67%.
Now, with 10 full sessions left to end 2024, IAG flies above all of them and does so, furthermore, placing its price at March 2020 levelsin full decline due to the appearance of the pandemic.
Only this Monday, the company that owns Iberia achieved intraday increases of 1.7%, reaching a 100% increase in 2024. In December alone, it achieved 14 points of this increase. The latest news that encouraged investors was that the company has adopted the AirTags system, an application to locate lost luggage. IAG hopes that this new tool will help it reduce costs although it points out that it is still too early to know how much money can be saved.
At the moment, and although the shares are flying faster than the experts’ own valuations, IAG shares would still have a slight upward potential for 2025. Specifically, they could continue the stock market climb an additional 3% to 3. 68 euros that they set as the average target price for their titles. Nevertheless, There are already up to five investment banks that estimate the price of IAG on the stock market above 4 euros (12% distance) and two of them even point to 5 euros. The firm Panmure Liberum offers the most optimistic valuation, at 5.99 euros, which would represent new historical highs for the airline on the stock market, beating the previous ones dating back to 2015 at 5.76 euros.
“We hope that the current good situation will be maintained in the coming years. months, although we anticipate that traffic growth will begin to moderate from the last quarter of 2024 and that prices maintain the trend of last few months to stabilize. Additional support for the demand will be the expectation of rate falls from both the ECB and the Fed by allowing a increase in disposable income. The great operational improvement, however, was will occur due to the drop in the unit cost of fuel, after the decrease in crude oil prices and the hedges signed (76% in Q4 24 and 61% in 2025) at lower prices than in the first nine months of 2024″, they point out from Renta 4 as prospects for the company in 2025. Consequently, they recommend buying the company’s shares.
“There is room for upside European airlines’ profits in 2025 from blocking aviation fuel prices at low levels compared to the 2024 average, and as long as yields remain in summer. However, margin expansion appears limited by inflation of non-fuel unit costs salaries, maintenance and supplier components. The large operators Lufthansa, Air France-KLM and IAG are seeking internal efficiency programs and consolidation,” Bloomberg Intelligence also explains in this sense.
On the stock market, one of the matters that IAG still has pending is to return to trading, almost five years later, at the levels at which it did before the appearance of the pandemic. Specifically, is still 30% away from recovering the 5.11 euros that its shares were worth before the Covid-crash.
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