IAG: Dominant Heathrow Position Will Spur Outperformance As Buybacks Continue

Analysts have raised their price target for International Consolidated Airlines Group, with estimates increasing from 475 GBp to as high as 620 GBp. They cite expectations for improved profit margins and steady revenue growth, which support a more favorable outlook for the shares.

Analyst Commentary

• Bullish analysts have increased price targets for International Consolidated Airlines Group, citing improved expectations for future performance.
• Upward revisions reflect optimism around the company's profit margin expansion and consistent revenue growth.
• Analysts highlight the firm's dominant position at London Heathrow as a key competitive advantage, which supports a favorable growth outlook.
• The company is now named a top pick in the European airline sector by some major research firms, pointing to confidence in its execution and ability to capture market share.

What's in the News

• Citi raised its price target on IAG to 620 GBp from 390 GBp and maintained a Buy rating (Citi).
• Morgan Stanley initiated coverage with an Overweight rating and a EUR 5.50 price target, naming IAG as its top pick in European airlines (Morgan Stanley).
• The Board of Directors approved a gross interim dividend of EUR 0.048 per share for 2025. Payment is scheduled to begin on 1 December 2025 (company announcement).
• IAG completed repurchasing over 246 million shares, representing 5.14% of the company, as part of its ongoing buyback program for a total of €950 million (company announcement).

Valuation Changes

• The Fair Value Estimate has increased slightly from £4.63 to £4.66 per share.
• The Discount Rate has decreased mildly, moving from 10.31% to 10.08%.
• The Revenue Growth Forecast has edged up from 3.25% to 3.28% annually.
• The Net Profit Margin Projection has increased from 9.39% to 9.93%.
• The estimate for the future Price-to-Earnings (P/E) Ratio has declined from 8.67x to 7.89x.