British Airways owner International Consolidated Airlines Group SA (LSE:IAG) offers investors upside, just not quite as much, that’s the view of analysts at Deutsche Bank.
It comes amid uncertainty over international travel demand, due to the economic impacts downstream of the trade wars brought on by Donald Trump’s tariffs.
“At 262p, IAG shares are 29% below the 366p peak from 7th Feb, triggered by warnings of US domestic demand weakness from early March and exacerbated by the negative ramifications for US & global GDP from the reciprocal tariff proposals,” analyst Jaime Rowbotham said.
“Undoubtedly, the outlook for airlines exposed to transatlantic travel has deteriorated … we think that for all three EU network airlines, profit exposure to the US potentially stands at 50% of group or possibly more.”
Nevertheless, the German bank’s analysts have repeated a ‘buy’ rating and a new price target of 370p, reduced from 400p.