Coronavirus crash: IAG share price marches lower amid flight cancellations

Over the last eight trading sessions, shares in IAG have fallen by more than 25% as the coronavirus outbreak worsens, forcing UK airlines to cancel flights across Europe.

International Consolidated Airlines Group (IAG) shares have fallen by more than a quarter over the last eight trading sessions – wiping off over £15 billion in value from the stock – as the COVID-19 outbreak worsens, forcing UK airlines to cancel flights.

In fact, the British Airways-owner and its rival Ryanair said that it will cancel hundreds of flights, particularly Italian short-haul trips throughout March and April, due to the coronavirus impacting consumer demand.

IAG is trading at 455p a share as of 13:10 (GMT) on Tuesday.

Looking to trade IAG and other UK stocks? Open a live or demo account with IG today.

Berenberg lowers IAG target price amid COVID-19 outbreak

Analysts from Berenberg reiterated their ‘buy’ rating for IAG but opted to lower their target price for the stock from £7 to £6.20 a share due to concerns over the coronavirus threat and its impact on the travel industry.

‘Management noted that Asia Pacific demand appears to be slowly stabilising. IAG has redeployed some capacity elsewhere but it is cautious about making deeper cuts,’ Berenberg said in a note.

‘More immediately, near-term Europe bookings have weakened quickly and unevenly,’ analysts from the Hamburg-based bank added. ‘Italy has destabilised as both corporate and leisure customers cancel trips. However, other markets were holding up at the time of Friday's Q4 release, including Tenerife, the site of a high-profile coronavirus outbreak.’

However, analysts from the German bank still think IAG is capable of generating ‘sustainable outer-year returns above its peers’ based on its M&A activities and an ‘opportunistic 737 MAX fleet renewal’.

Based on the stock trading at 455p a share, analysts from Berenberg believe the stock has a potential upside of 36%.

You can go long or short IAG with IG using derivatives like CFDs.

IGA, may distribute information/research produced by its respective foreign affiliates within the IG Group of companies pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the research is distributed in Singapore to a person who is not an Accredited Investor, Expert Investor or an Institutional Investor, IGA accepts legal responsibility for the contents of the report to such persons only to the extent required by law. Singapore recipients should contact IGA at 6390 5118 for matters arising from, or in connection with the information distributed.

The information/research herein is prepared by IG Asia Pte Ltd (IGA) and its foreign affiliated companies (collectively known as the IG Group) and is intended for general circulation only. It does not take into account the specific investment objectives, financial situation, or particular needs of any particular person. You should take into account your specific investment objectives, financial situation, and particular needs before making a commitment to trade, including seeking advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit.

Please see important Research Disclaimer.

Seize a share opportunity today

Go long or short on thousands of international stocks.

  • Increase your market exposure with leverage
  • Get spreads from just 0.1% on major global shares
  • Trade CFDs straight into order books with direct market access

Live prices on most popular markets

  • Forex
  • Shares
  • Indices
liveprices.javascriptrequired
liveprices.javascriptrequired

Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.

liveprices.javascriptrequired

Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 20 mins.

The Momentum Report

Get the week’s momentum report sent directly to your inbox every Monday for FREE. The Week Ahead gives you a full calendar of upcoming key events to monitor in the coming week, as well as commentary and insight from our expert analysts on the major indices to watch.

For more info on how we might use your data, see our privacy notice and access policy and privacy webpage.

You might be interested in…

Find out what charges your trades could incur with our transparent fee structure.

Discover why so many clients choose us, and what makes us a world-leading provider of CFDs.

Stay on top of upcoming market-moving events with our customisable economic calendar.