Street View: Ryanair faces pressure from fare challenges, market shift
** Ryanair's RYA.I Q1 profit almost halved due to a 15% fare drop, significantly missing analysts' forecasts, with management noting ongoing ticket price deterioration
** Average recommendation of 21 brokerages is "buy," median PT is EUR 24.00 - LSEG data
ROUGH SKY AHEAD
** JP Morgan ("overweight," PT: EUR 25.00) views Ryanair's Q1 weaker than "even the most bearish sell-side/buy-side estimates," and adds softer pricing outlook may prompt questions about the 'bottom' in terms of demand, pricing, and potential estimate downgrades
** Barclays ("equal weight," PT: EUR 18.50) indicates Q2 pricing's final result hinges on late August and September pricing, though RYA notes a continued deterioration at the moment
** Bernstein ("outperform," PT: EUR 23.50) says fare guidance downgrade suggests incremental weakness in closer-in bookings
** Deutsche Bank ("hold," PT: EUR 22.00) highlights Q2 fares forecast support broker's cautious pricing views and sees downward pressure on FY25 consensus PAT for Ryanair
** Davy ("outperform," PT: EUR 24.00) cuts its FY25 net income estimates by c.15%, and notes a change in market dynamics, shifting from "revenge travel" last year to a more "normalised demand"
** RBC ("outperform," PT: EUR 24.00) sees longer-term attractions to Ryanair's low-cost, and relatively high-margin business model, and sees FCF yields exceeding 10% by FY26E as capex steps down, leaving scope for further shareholder returns
Reporting by Marta Serafinko
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