Deutsche Lufthansa (XTRA:LHA): Assessing Valuation After Labor Dispute Pause and Latest Earnings Update

Deutsche Lufthansa (XTRA:LHA) shares are in focus after Germany’s pilot union postponed planned industrial action, which has eased worries about potential disruptions. This move brings some breathing room for the airline and its investors.

See our latest analysis for Deutsche Lufthansa.

This pause in labor tensions comes shortly after Lufthansa’s quarterly report, which showed steadier long-term progress even as this quarter’s net income dipped compared to last year. The airline’s share price has gained 21% so far in 2025, and its total shareholder return over the past year sits at an impressive 25%. While recent one-day movements have been choppy, momentum over the year suggests that optimism around operational stability and improved earnings is gradually building.

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The recent labor peace and Lufthansa's steady full-year gains naturally raise a core investing question: is the stock trading below its true value as stability returns, or has the market fully priced in growth expectations?

Most Popular Narrative: Fairly Valued

Lufthansa’s closing price nearly matches the most popular narrative’s fair value calculation. This suggests that the market sees current fundamentals and future projections as largely in balance.

Significant faith is being placed in the company's multi-brand structure, international partnerships, and network effects to drive sustained earnings momentum. However, operational complexity, integration risks (such as ITA, Technic, Cargo), and intensifying price competition from low-cost carriers and alternative transport modes threaten both operating efficiency and long-term return on capital.

Read the complete narrative.

What’s the single most pivotal bet behind this fair value? The answer ties to how the narrative weighs competitive strengths against structural industry risks. If you want a look under the hood at the projections and the potential friction points, you’ll want to see the detailed breakdown driving this call.

Result: Fair Value of $7.65 (ABOUT RIGHT)

Have a read of the narrative in full and understand what's behind the forecasts.

However, surging fuel costs or a faster-than-expected recovery in business travel could quickly challenge the current consensus and shift earnings expectations once again.

Find out about the key risks to this Deutsche Lufthansa narrative.

Build Your Own Deutsche Lufthansa Narrative

If you see things differently or want to dig into the numbers yourself, it’s easy to assemble your own narrative in just a few minutes. Do it your way.

A great starting point for your Deutsche Lufthansa research is our analysis highlighting 4 key rewards and 2 important warning signs that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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