Jet2 PLC (AIM:JET2)’s warning over price competition is likely to concern investors, especially given rival easyJet did not mention such pressures, analysts have said.
According to Jet2’s update on Wednesday, demand has improved year on year heading into the busier summer period.
However, pricing has become more competitive in recent months, the airline said, translating to just “modest” increases in rates.
Peel Hunt analysts noted the warning was likely to fuel investors’ fears, partially due to the fact rivals had not raised such concerns.
“This appears to be less positive than easyJet's statement a week ago,” Peel Hunt said. “We expect this to concern investors."
That said, trading was “good,” the bank continued, with profit guidance for a 33% increase to £515-520 million coming in line with consensus.
Peel Hunt also noted cash of £3.2 billion was £300 million ahead of its forecast.
“Tensions in the Middle East appear to have eased,” the bank noted, “which may see pricing firm again”.
A ‘buy’ rating and share price target of 2,200p was held.
Shares fell 5.6% to 1,404p on Wednesday.