Analysts at UBS have a bullish view on upcoming earnings reports from big-cap budget carriers easyJet plc and Ryanair Holdings PLC (LSE:RYA).
UBS reckons easyJet’s third-quarter revenues will outperform City forecasts, with the bank predicting £2.87 billion, up from £2.36 billion in the previous year’s third quarter and exceeding the consensus estimate of £2.66 billion.
Traffic is tipped to grow 8% with modest profit growth supported by strong holiday sales plus ancillary revenues.
As for Irish budget competitor Ryanair, UBS expects first-quarter revenue of €3.8 billion (£3.2 billion), compared to €3.65 billion in the first quarter of 2024 but slightly below the consensus estimate of €3.90 billion.
The focus for both airlines will be the rebound in holiday spending.
It should be good news given the bullish spending patterns recently published in TSB’s latest ‘How Britain Spends’ report.
According to TSB data, there was a 9.2% increase in spending with airline and travel companies in the first six months of 2024 compared to the same period in 2023.
It shows that Brits are choosing to “spend on rollercoasters and beaches over new clothes or DIY”, said TSB.
Ryanair reports on Monday, 22 July and easyJet on Wednesday, 24 July.