(Boursier.com) — Air France KLM rose by 1.6% to 9.55 euros this Wednesday, while Citi cut its target from 19 to 12 euros by being ‘neutral’ on the issue. Oddo BHF had previously reiterated its ‘underperformance’ opinion on the air carrier with a target reduced to 9 euros. Covid reimbursements and the rise in Brent prices are putting pressure on cash with an adjusted FCF now expected at €2.8 billion cumulatively over the 2024-2026 period, while the broker estimates that the benefits of the 2028 plan will be concentrated on the end of the period. He notes, however, that we see a slight brightening with an improvement in CASK momentum expected from Q2.
Concerning the first quarter, despite the good performance of reservations (also a good omen for the summer season), the analyst is counting on a strong consumption of FCF of 1.32 BnE, due in particular to the entirety of the reimbursement of 610 ME to the AF pilots’ pension fund made in January as well as a reimbursement of 125 ME of salary taxes and an increase in Capex.
Despite the underperformance since the start of the year, the stock trades on an EV/EBITDA multiple of 4.1x which shows a premium of 22% compared to the average of peers IAG and Lufthansa.
JP Morgan, for its part, adjusted its target from 9.2 to 9 euros while remaining ‘underweight’.
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