easyJet: UBS cuts estimates and target price
(CercleFinance.com) - While maintaining its neutral rating on the share of the British low cost airline easyJet, UBS has significantly reduced its forecasts.
It has also cut its 12-month target price for the share by close to 20%, now forecasting 1,080 pence, against 1,310 pence previously.
Analysts have reduced their forecasts after the group's trading update for the first half of 2018/2019, which was announced yesterday. UBS believes that Brexit and macroeconomic conditions will weigh on prices, while the cost of fuel is expected to rise. As a result, analysts have reduced their EPS guidance for 2018/2019 and 2019/2020 by 20% and 23% respectively.
However, UBS does not recommend investors sell the share, as easyJet (whose fiscal year closes at the end of September) generates most of its earnings over the summer months, while management's related forecasts could prove to be excessively conservative.
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The information and analyses distributed by Cercle Finance are only intended as decision-making support for investors. Cercle Finance's responsibility may not be entailed, either directly or indirectly following the use of such information and analyses by readers. Any non-professional investor is recommended to consult a professional advisor before making any investment decision. This indicative information in no way constitutes any invitation to sell or buy securities.
It has also cut its 12-month target price for the share by close to 20%, now forecasting 1,080 pence, against 1,310 pence previously.
Analysts have reduced their forecasts after the group's trading update for the first half of 2018/2019, which was announced yesterday. UBS believes that Brexit and macroeconomic conditions will weigh on prices, while the cost of fuel is expected to rise. As a result, analysts have reduced their EPS guidance for 2018/2019 and 2019/2020 by 20% and 23% respectively.
However, UBS does not recommend investors sell the share, as easyJet (whose fiscal year closes at the end of September) generates most of its earnings over the summer months, while management's related forecasts could prove to be excessively conservative.
Copyright (c) 2019 CercleFinance.com. All rights reserved.
The information and analyses distributed by Cercle Finance are only intended as decision-making support for investors. Cercle Finance's responsibility may not be entailed, either directly or indirectly following the use of such information and analyses by readers. Any non-professional investor is recommended to consult a professional advisor before making any investment decision. This indicative information in no way constitutes any invitation to sell or buy securities.