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Investing.com - Deutsche Bank (ETR:DBKGn) upgraded Wizz Air Holdings Plc (LON:WIZZ) from Hold to Buy and set a price target of GBP15.00, citing the airline’s strategic realignment toward core markets. The stock, currently trading at $4.15, appears undervalued according to InvestingPro analysis, with a P/E ratio of 5.46 and market capitalization of $1.68 billion.
The upgrade follows Wizz Air’s announcement that it will slow its growth ambition from 15-20% annually to 10-12% over the next three years, according to Deutsche Bank’s analysis.
The low-cost carrier also revealed plans to significantly reduce its Airbus A321XLR order, taking only 10-15 aircraft versus the 47 originally ordered, and converting the remainder to A321neos with a more deferred delivery schedule extending to 2032.
Deutsche Bank highlighted Wizz Air’s suspension of Abu Dhabi operations as part of the company’s broader strategic shift to refocus on its core markets.
The airline additionally aims to resolve its GTF engine issues completely by mid-2027, with a target of having zero aircraft grounded due to these problems by that time.
In other recent news, Wizz Air reported a 10% increase in passenger numbers for May, totaling 5.7 million passengers. The airline’s load factor, which measures how full flights are, rose to 91.2%. Despite this growth, RBC Capital downgraded Wizz Air’s stock rating from Outperform to Sector Perform. The firm also significantly reduced the price target from £24.00 to £15.00. Analysts at RBC Capital adjusted their forecast, lowering the FY26 estimated net profit after tax by 31%, which is 37% below previous consensus estimates. This reflects concerns about Wizz Air’s financial performance in upcoming fiscal years. Additionally, analysts anticipate that Wizz Air will need to accelerate its passenger growth to 30% in June to meet the first quarter’s consensus of 18 million passengers. These developments underscore the mixed outlook for Wizz Air amid recent passenger growth and financial challenges.
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