Qantas Airways: Near-term turbulence

About the author:

Author name:

By Billy Boulton

Job title:

Associate Analyst

Date posted:

12 October 2023, 7:00 AM

Sectors Covered:

Agriculture, Travel, Chemicals, Food & Beverage

• Following Qantas Airways' (ASX:QAN) recent September market update, which highlighted higher fuel/FX costs and increased reinvestment in the business to repair its reputation and brand, we have made material downgrades to our FY24/25/26 forecasts.
• We believe that FY23 remains a sustainable base for QAN’s future earnings, however we note that FY24 will likely now be a transitionary year for the company.
• Whilst the risk profile of QAN has clearly changed in recent months given increased government, regulatory and public scrutiny, we are of the view that near-term negative sentiment and fuel/FX headwinds have potentially seen QAN materially oversold. ADD maintained. Our price target moves to (login to view).

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