After reviewing domestic routes that Rex Airlines is now flying, Credit Suisse believes higher competition is likely to offset part of the benefit of Qantas’ -$1bn cost-cutting. Additionally, the Qantas fleet is ageing and the broker estimates capex will step up to -$3bn annually.
Credit Suisse maintains the Underperform rating and believes the share price doesn’t adequately reflect the risk of further covid disruptions. The target is kept at $4.15.
Sector: Transportation.
Target price is $4.15.Current Price is $4.66. Difference: ($0.51) – (brackets indicate current price is over target). If QAN meets the Credit Suisse target it will return approximately -12% (excluding dividends, fees and charges – negative figures indicate an expected loss).
