Wizz Air Holdings PLC (AIM:WIZZ) chief executive officer, Jozsef Varadi has told analysts that the group’s decision to convert its options for 75 Airbus A321neo aircraft emphasises its importance to the investment case for the company over the next decade.
This was one of the key takeaways Deutsche Bank analysts reported from a trip hosted by the company.
They noted that the Airbus aircraft is scarcely available to its competitors that don't already have orders unless they are willing to pay material leasing premiums to Wizz, and it is an aircraft with unmatched economics which when full is expected to give Wizz a material competitive advantage versus its peers.
The analysts said there are a number of risks outside of the group’s control such as Airbus’ ability to deliver on time but the other concerns are down to the company such as filling the planes.
They noted that Wizz feels its business model is less sensitive to frequencies than that of rival Ryanair, for example, with the main priority for its customers being price.
Given the subsequent ability to control when people fly, Wizz is confident in taking on the extra seat risk, the analysts added.
Deutsche Bank retains a 'hold' rating and 2,350p price target on Wizz Air shares.