Analysts remain cautious over Ryanair Holdings PLC (LSE:RYA) as passenger stats for December fell slightly short of market expectations despite reaching levels last seen prior to the Covid-19 pandemic.
Traffic numbers were some 2.6% higher than December 2019, at 11.2mln passengers, spanning some 65,500 flights. Year-on-year comparison makes more impressive reading, as the monthly number comes in 21% above last December which was impacted by the Omicron variant of Covid.
Nevertheless, compiled with October and November volumes it leaves the low-cost airline short of analyst expectations for the final calendar quarter of 2022, and, looking into the airline’s fourth fiscal quarter it now has some catching up to do if it is to reach its own targets for the year.
“The passenger figures for the quarter were slightly light of our forecast at 38.4mln (vs. our 40.5mln estimate), although that could imply a stronger fourth than we had assumed to reach management’s 168mln target for the year to March 2023,” Liberum Capital analyst Gerald Khoo said in a note.
“We retain a cautious stance with current consensus implying a double-digit percentage average fare improvement next FY, which strikes us as challenging in a likely recessionary environment.
Peel Hunt analyst Alexander Paterson, meanwhile, said: “This [target] should be achievable as long as there are no travel restrictions or sustained periods of bad weather.”
At €12.475, Ryanair shares are down by slightly in Wednesday morning’s dealing, and, remain off some 4% since early December.
Liberum retains a ‘hold’ rating for the airline’s shares with its target price set at €13, whilst Peel Hunt by comparison is more bullish with its target pitched at €18 per share and its recommendation set as ‘buy’.