British Airways owner IInternational Consolidated Airlines Group SA (LSE:IAG) shares rose 1.5% after it was suggested it could launch a buyback later this year to support a "modest dividend", by analysts at RBC.
After a meeting with the airline group's chief finance officer, RBC was reassured that full-year underlying earnings estimates of €3.6 billion were in line with trading, which was said to be "positive overall".
IAG also quelled concerns driven by industry rivals after they scaled back summer growth estimates, with management telling RBC there was little read across.
Despite forecasts of a modest reduction in second-quarter sales growth, the Canadian bank is confident IAG can achieve growth in the full year.
RBC said: "Unit cost pressures were in line with expectations overall, although with industry-wide maintenance, repair and operation pressures notable.
"Further ahead, there was scope for buybacks to supplement a modest dividend if previously outlined conditions on shareholder returns were satisfied."
RBC kept its 230p share price target, which represents around a 40% premium to its market value, and rates the stock 'outperform'.