International Consolidated Airlines Group S.A.

LSE:IAG Stock Report

Market Cap: UK£8.7b

International Consolidated Airlines Group Valuation

Is IAG undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

4/6

Valuation Score 4/6

  • Below Fair Value

  • Significantly Below Fair Value

  • Price-To-Earnings vs Peers

  • Price-To-Earnings vs Industry

  • Price-To-Earnings vs Fair Ratio

  • Analyst Forecast

Share Price vs Fair Value

What is the Fair Price of IAG when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: IAG (£1.77) is trading below our estimate of fair value (£2.07)

Significantly Below Fair Value: IAG is trading below fair value, but not by a significant amount.


Key Valuation Metric

Which metric is best to use when looking at relative valuation for IAG?

Other financial metrics that can be useful for relative valuation.

IAG key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue0.7x
Enterprise Value/EBITDA4.4x
PEG Ratio-15.2x

Price to Earnings Ratio vs Peers

How does IAG's PE Ratio compare to its peers?

The above table shows the PE ratio for IAG vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
CompanyForward PEEstimated GrowthMarket Cap
Peer Average11.9x
EZJ easyJet
12.5x16.5%UK£4.0b
WIZZ Wizz Air Holdings
24.1x36.4%UK£2.2b
JET2 Jet2
7x1.3%UK£3.0b
LHA Deutsche Lufthansa
4.2x2.0%€8.0b
IAG International Consolidated Airlines Group
3.8x-0.3%UK£8.7b

Price-To-Earnings vs Peers: IAG is good value based on its Price-To-Earnings Ratio (3.8x) compared to the peer average (11.9x).


Price to Earnings Ratio vs Industry

How does IAG's PE Ratio compare vs other companies in the Global Airlines Industry?

0 CompaniesPrice / EarningsEstimated GrowthMarket Cap
Industry Avg.n/a6.1%
n/an/an/a
No. of CompaniesPE048121620

Fetching data

0 CompaniesPrice / EarningsEstimated GrowthMarket Cap
Industry Avg.n/a6.1%
n/an/an/a
No more companies

Price-To-Earnings vs Industry: IAG is good value based on its Price-To-Earnings Ratio (3.8x) compared to the Global Airlines industry average (8.6x).


Price to Earnings Ratio vs Fair Ratio

What is IAG's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

IAG PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio3.8x
Fair PE Ratio14.3x

Price-To-Earnings vs Fair Ratio: IAG is good value based on its Price-To-Earnings Ratio (3.8x) compared to the estimated Fair Price-To-Earnings Ratio (14.3x).


Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

The above table shows the analyst IAG forecast and predictions for the stock price in 12 month’s time.
DateShare PriceAverage 1Y Price TargetDispersionHighLow1Y Actual priceAnalysts
CurrentUK£1.76
UK£2.29
+29.8%
28.6%UK£4.53UK£1.72n/a15
Apr ’25UK£1.77
UK£2.26
+27.6%
29.0%UK£4.51UK£1.72n/a15
Mar ’25UK£1.47
UK£2.15
+46.7%
31.2%UK£4.50UK£1.40n/a16
Feb ’25UK£1.46
UK£2.19
+50.6%
30.9%UK£4.50UK£1.40n/a15
Jan ’25UK£1.55
UK£2.14
+38.0%
26.8%UK£4.03UK£1.37n/a15
Dec ’24UK£1.57
UK£2.12
+35.6%
26.9%UK£4.05UK£1.38n/a16
Nov ’24UK£1.45
UK£2.18
+50.4%
25.8%UK£4.08UK£1.62n/a16
Oct ’24UK£1.48
UK£2.29
+54.9%
26.2%UK£4.23UK£1.61n/a15
Sep ’24UK£1.59
UK£2.32
+45.7%
26.1%UK£4.21UK£1.60n/a15
Aug ’24UK£1.70
UK£2.28
+33.8%
27.9%UK£4.20UK£1.41n/a15
Jul ’24UK£1.62
UK£2.10
+29.7%
22.8%UK£3.47UK£1.41n/a14
Jun ’24UK£1.56
UK£2.15
+38.1%
24.3%UK£3.50UK£1.18n/a14
May ’24UK£1.52
UK£1.94
+27.7%
20.1%UK£2.65UK£1.20n/a15
Apr ’24UK£1.51
UK£1.93
+27.7%
20.4%UK£2.64UK£1.20UK£1.7715
Mar ’24UK£1.54
UK£1.88
+22.1%
20.2%UK£2.66UK£1.21UK£1.4714
Feb ’24UK£1.68
UK£1.78
+6.1%
22.0%UK£2.65UK£1.00UK£1.4613
Jan ’24UK£1.24
UK£1.61
+30.4%
23.1%UK£2.58UK£1.00UK£1.5513
Dec ’23UK£1.33
UK£1.56
+17.6%
22.4%UK£2.58UK£1.00UK£1.5714
Nov ’23UK£1.23
UK£1.54
+24.7%
23.2%UK£2.58UK£0.99UK£1.4514
Oct ’23UK£0.95
UK£1.69
+78.6%
28.6%UK£2.83UK£1.04UK£1.4815
Sep ’23UK£1.05
UK£1.65
+58.3%
28.3%UK£2.70UK£1.00UK£1.5915
Aug ’23UK£1.16
UK£1.61
+38.7%
28.4%UK£2.67UK£0.98UK£1.7016
Jul ’23UK£1.09
UK£1.74
+59.5%
24.2%UK£2.75UK£1.22UK£1.6216
Jun ’23UK£1.26
UK£1.82
+44.4%
21.5%UK£2.74UK£1.22UK£1.5616
May ’23UK£1.44
UK£1.87
+30.1%
19.9%UK£2.69UK£1.19UK£1.5216
Apr ’23UK£1.41
UK£1.89
+33.9%
20.0%UK£2.69UK£1.19UK£1.5116

Analyst Forecast: Target price is more than 20% higher than the current share price, but analysts are not within a statistically confident range of agreement.


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