Ryanair Holdings PLC (LON:RYA) is named among the ‘buy’ recommendations of UBS which sees the summer (the third quarter) as a “make or break” period for the airlines.
“The European Airline sector has performed negatively (Eurotop 300 is flat vs the MSCI EU airlines down c2%) due to negative earnings momentum,” said analyst Jarrod Castle.
“However, if summer delivers despite oil price increase we think the airlines can still end the year in positive territory.”
READ: Ryanair warns on further staff disruptions, lower fares and Brexit uncertainty
UBS, in a statistical analysis of the sector, highlighted that data suggests that long haul capacity across the sector will grow in the third quarter by 7.5%, while short haul will increase by 4.5% - and that both figures are below market expectations.
At the same time, the data from airlines covered by UBS suggests 4.4% average growth.
Ryanair and easyJet Plc (LON:EZJ) are among the few fancied names at UBS, both are rated as ‘buys’ - the former carries a €18.50 price target and the latter’s target is set at 1,800p.
In Thursday’s deals, Ryanair shares gained 0.96% to trade at €15.80 and easyJet advanced 1.21% to 1,678p.