International Consolidated Airlines Group SA (LSE:IAG) gained on Wednesday after being upgraded to a ‘buy’ rating by Deutsche Bank analysts.
Lifting the British Airways owner from a ‘hold’, Deutsche noted capacity constraints on transatlantic flights should leave IAG able to lift prices into 2025.
“This is supported by early evidence from our fares tracker and underpinned by the macro outlook for the US, the UK and Spain,” analysts said.
Lower fuel costs should also act as a tailwind over the coming year, leaving scope for ahead-of-consensus earnings growth, according to the bank.
“We think the journey towards a better BA has only just begun,” Deutsche continued.
“Improvements at Aer Lingus, the continued leveraging of the Spanish platforms and growing IAG loyalty should also help.”
A 400p share price target was also set, against 215p previously.
Shares climbed 1.9% to 287.4p on Wednesday.