British Airways owner IAG looks set for a mixed first quarter update on 10 May, according to analysts at Stifel, with improving transatlantic trends offset by ‘investment’ costs.
Underlying profits [EBIT] of €11m is what the broker expects IAG to announce, with unit revenue growth of 1% year-on-year.
Against that costs are forecast to be up by 3.5% ex-fuel due to what the broker describes as ‘product investments’ at British Airways, which is usually an industry talk for discounts or promotions.
“Discussions on results day are likely to centre around summer trading (positive), any news on the Air Europa acquisition (potentially negative) and potential earlier resumption of dividend payments (potentially positive).”
Hold with a €2 (172p) price target is Stifel’s view.