Air France-KLM, British Airways and Iberia gain on analyst comments; Aegean Airlines down
Air France-KLM (+1.5%) rose for a second consecutive day after Deutsche Bank AG upgraded its rating of the airline group's shares from "hold" to "buy", stating its "trans-Atlantic JV with Delta is under-appreciated by the market". The gain was despite a 0.3% decline in France's CAC for the day.
- Air France-KLM's shares rose after an upgrade in rating by Deutsche Bank, highlighting the under-appreciated value of its trans-Atlantic joint venture with Delta.
- Air France-KLM plans to increase capacity for its winter 2010/2011 schedule, with a focus on expanding long-haul routes.
- British Airways and Iberia saw gains following a positive note from Goldman Sachs, which highlighted strong trading and potential synergies from their merger.
- Societe Generale downgraded its rating of British Airways from "buy" to "hold", tempering the airline's gains.
- TUI Travel rebounded and Vueling also experienced gains, while Aegean Airlines and Norwegian declined.
- Analysts anticipate tighter premium yields across the North Atlantic as a result of the joint venture between BA, Iberia, and American Airlines.
The group stated during trading that it plans to increase capacity (ASMs) by 3.3% for its winter 2010/2011 schedule, compared with the previous corresponding period. The carrier plans to expand long-haul capacity by 4.1% and medium-haul 0.5%.
British Airways (+1.0%) and Iberia (+0.5%) made some ground after a bullish Goldman Sachs note. The analysts stated stronger than expected trading over summer 2010-11 would be reflected in its next financial results.
The analysts stated: "BA and Iberia are merging which we believe will produce synergies, but more interesting, in our view, is the joint venture between BA, Iberia and American which should lead to tighter premium yields across the North Atlantic as corporate deals and discounts are renegotiated."
BA gains were softened by Societe Generale downgraded its rating of the carrier from "buy" to "hold".
Elsewhere, TUI Travel (+3.2%) rebounded, while Vueling (+1.8%) also gained. Aegean Airlines (-3.6%) and Norwegian (-2.1%) declined.
Europe selected airlines daily share price movements (% change): 22-Oct-2010
Source: Centre for Asia Pacific Aviation, Yahoo! Finance & Reuters