Wizz Air - The Time Has Come To Stock Up Again
The time has come to stock up again
- Wizz Air is due to post its fiscal H1/23 earnings report on 2 Nov (Wednesday), BMO. We think that current consensus figures are a bit high, so we are very cautious that our earnings revision will be followed by downgrades.
- Having said that, we upgrade Wizz Air to Buy from Neutral, but cut TP to 22 GBP/sh from 28 GBP/sh, reflecting the deteriorating macro picture amid the monetary tightening cycle, triggered by elevated inflation. Wizz Air continues to face a very strong headwind in the CEE and the sustainability of the solid double-digit growth in the next 12 months could be at risk even if a market consolidation is increasingly likely. In our view, it is also conceivable that Wizz may soon receive a takeover bid as its mkt cap plunged below GBP 2bn, where it traded roughly 6 years ago. Our new TP implies a 53% upside.
Wizz Air Holding is a European airline. As of Mar 31 2017, Co. provided more than 500 routes from 28 bases, connecting 141 destinations across 42 countries. Co. has two reportable segments: the airline and the tour operator business units, marketed under the Wizz Air and Wizz Tours brand names, respectively. Wizz Air sells flight tickets and related services to external customers and, to an extent, to Wizz Tours. Wizz Tours sells travel packages to external customers covering the network of Wizz Air.
Concorde Securities Ltd. is Hungary’s leading independent company engaged in investment banking activities. It provides its clients with integrated financial services, including securities trading, research, corporate financing advisory, capital market transactions, wealth management and investment advisory. The operational management of the company is the responsibility of the CEO, while the owners/managers (who control one-third of the company through their shares and options) are in charge of its strategic governance. Concorde Securities Ltd. is a member of the Budapest, Frankfurt, Warsaw and Bucharest stock exchanges, as well as of the Hungarian Association of Investment Service Providers.
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