Ryanair shares close to new highs: but is travel uncertainty an issue?
The Ryanair share price is approaching a three-year high as hopes of summer travel improve. However, even with fresh optimism from transport secretary Grant Shapps, could it still be a summer of turbulence for Ryanair shares?
- Ryanair share price approaching three-year high
- Analysts forecast a €20.00 share price
- Can a positive report outweigh travel uncertainty?
- Want to trade Ryanair shares? Open an account today
Ryanair (RYA) shares opened at €15.51 on 13 April, and climbed to €15.88 within an hour. The bullish trend marks a continued uptick in value since the Ryanair share price hit a five-year low of €8.52 in April 2020. Although the outlook for airlines remains unclear, shares in Ryanair are now approaching a three-year high.
What’s fuelling Ryanair’s bull run?
Covid-19 vaccinations and falling death figures are helping the bullish sentiment. Despite recent flight cancellations by other low-cost airlines, Ryanair has introduced a 'no change fee'. The scheme will run until October 2021 and allow customers to amend any flights affected by Covid-19 restrictions. The system permits up to two free changes, something Ryanair’s commercial director Jason McGuinness believes will get the airline and customers through any short-term uncertainty.
British transport secretary Grant Shapps also delivered a more optimistic message on summer travel. Although cautious, he told the BBC on 9 April, ‘for the first time’ in months, he’s ‘not advising against booking foreign holidays’.
International travel will resume on 17 May, but a traffic light system will be in place. It’s not yet clear how this will impact travel, but Shapps’ assertion that there is ‘light at the end of the tunnel’ is more positive than recent advice urging people ‘not to book’ until the ‘picture is clearer’.
What is the Ryanair share price forecast?
Berenberg recently upgraded Ryanair shares from 'hold' to 'buy' on 30 March, inspired by a 'whipped around' positive outlook on 2021/2022 travel. Current Ryanair share price forecasts range from €18.25 as a medium value, to a high of €20.00. Both forecasts would see Ryanair shares hit their highest ever valuation.
Aside from easing restrictions, the airline’s recent guidance has contributed to the bullish sentiment among analysts. The year-end guidance to 31 March 2021 (FY21) showed a revised net loss figure. Due to improved conditions, Ryanair expects its upcoming loss to be 5%-10% lower than previously expected (€800 million - €850 million compared to €850 million - €950 million).
Credit rating agency Fitch has also given Ryanair a BBB rating, and has stated that its recovery could be quicker than the industry itself, due to its market position and short-haul routes. The airline’s liquidity is also strong, and Ryanair executives noted that the company has cash reserves of €3.21 billion at present. Although the report stopped short of offering any profit guidance, the tone was more positive than expected.
Could this be enough to keep Ryanair shares bullish until Covid restrictions are fully lifted, or will uncertainty continue to hamper the recent recovery?
Take your position on Ryanair shares
Trade UK shares for just a small initial deposit with spread bets or CFDs. Spread bets are completely tax-free, while CFDs are free from stamp duty.1 You can also buy and take ownership of UK shares for just £3 with us.2
Open an account to start trading or investing in UK shares.
1 Tax laws are subject to change and depend on individual circumstances. Tax law may differ in a jurisdiction other than the UK.
2 Deal three times or more in the previous month to qualify for our best rate.
This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.
Act on share opportunities today
Go long or short on thousands of international stocks with spread bets and CFDs.
- Get full exposure for a comparatively small deposit
- Trade on spreads from just 0.1%
- Get greater order book visibility with direct market access
See opportunity on a stock?
Try a risk-free trade in your demo account, and see whether you’re on to something.
- Log in to your demo
- Take your position
- See whether your hunch pays off
See opportunity on a stock?
Don’t miss your chance – upgrade to a live account to take advantage.
- Trade a huge range of popular stocks
- Analyse and deal seamlessly on fast, intuitive charts
- See and react to breaking news in-platform
See opportunity on a stock?
Don’t miss your chance. Log in to take advantage while conditions prevail.
Live prices on most popular markets
Prices above are subject to our website terms and agreements. Prices are indicative only. All share prices are delayed by at least 15 minutes.