The share price of International Consolidated Airline, LON: IAG is booming this year. It continues to perform better than most other companies. The share price has increased for nine weeks in a row, and reached a peak of 209,7p. This is its highest level since May 20,21.
The stock also jumped over 130% since its low point in 2022, as it outperformed the FTSE 100. It has underperformed American Airlines, United Airlines Delta and EasyJet in this year, as shown below.
In the past 12 months, the same thing has occurred. The stock price has increased by 40 percent while other companies’ shares have only risen less than 28 percent.
The airline industry is in good shape
IAG has over 580 aircraft and employs more than 71,000 people worldwide.
The company owns British Airways, Iberia and LEVEL. The company also owns IAG Cargo and IAG Loyalty. Customers can collect Avios points in its loyalty program. These can then be used to shop.
IAG’s cargo division is one of industry’s biggest players, offering over 15 000 flights per week.
British Airways is the most well-known IAG brand. It has more than 280 planes that travel from London to every continent. The fleet consists of Airbus A320s, A350s, A380s, Boeing 777s, Boeing 787s, and Boeing 777s.
IAG has seen a rise in leisure and business travelers since the end of the pandemic.
IATA’s most recent figures show that airlines are likely to make a profit of over $30 billion in this year. This is a jump of $3 billion from the previous forecast for 2023. The return on capital invested will be 5,7%, while total revenues in the industry are expected to rise by over $996 Billion.
IAG also benefits from the growing cargo business. The total cargo volume for this year is estimated to be 62 millions tons.
Manufacturers like Airbus, Boeing and others are facing manufacturing problems.
Airbus, while doing better than Boeing in terms of production targets, is still experiencing a shortage of materials such as semiconductors and Titanium. The company said in June that they were reducing their production goals. Boeing is experiencing a much worse situation, as its workers are on strike.
IAG is doing very well
IAG is benefiting greatly from the demand generated by its Transatlantic operations, both for leisure and business travelers.
Recent financial results showed that the company’s business performed well during the first half, as revenue increased from EUR13.58 to EUR14.7 billion.
The company’s operating profit increased from EUR1.26 to EUR1.3 billion. Profit after taxes was EUR905 millions. The company increased its guidance for the future as business was doing well.
IAG is paying dividends. The company announced that it would pay a EUR3 dividend per share, and expects this to grow in future years. The net debt has been reduced from EUR9.245 to EUR6.417.
IAG Stock Outlook
IAG’s stock price has been boosted by strong demand, positive analyst statements and its increased flights in North America.
JP Morgan analysts recently maintained their Buy rating for the stock. Redburn Atlantic, RBC Capital Markets and UBS all upgraded their ratings to buy.
However, airlines can be cyclical. Ryanair is a good example, as it was among the top performing companies in London during this year. The ADRs of the company peaked in April at $147.30 and have since crashed to $116.
Southwest Airlines was also a good example. It used to be regarded as one of the top airlines in the US. The stock reached a peak of $60 in 2021, but has now dropped below $30.
IAG Share Price Analysis
Weekly chart of the IAG share price shows a bullish tendency in recent months. Recently, it crossed an important resistance at 171,70p. This was its highest point in January 2023.
Stock is about form the golden cross pattern. This occurs when 50-weeks and 200-weeks moving averages form a bullish crossing. Spread between two moving averages continues to narrow.
If this crossover occurs, it is likely that the stock price will rise further as the bulls aim for the next significant resistance level at 219.4p – its high point from March 2021. If the stock breaks above this point, it will continue to rise. The next thing to look out for is a drop to 180p if the golden cross doesn’t happen.
The price of this post IAG stock is likely to show a rare bullish trend. This pattern can be changed as the updates are released.
