Aegean Airlines Q1 Performance Sparks Barclays Stock Upgrade and Revenue Growth Forecast
Aegean Airlines has shown remarkable results in its Q1 performance for 2025, prompting Barclays to upgrade its stock rating. This comes as a significant boost for the airline, which is poised to capitalize on strong Greek travel demand trends projected for 2025. With the airline’s operational revenue growth and capacity increase forecast, the future looks promising for Aegean Airlines.
Robust Q1 Performance Leads to Barclays Upgrade
In light of Aegean Airlines’ exceptional Q1 performance, Barclays, led by Andrew Lobbenberg, has raised the target stock price to €16 from €14.50, maintaining an “Overweight” rating. Most importantly, they increased their estimate for the airline’s annual operational earnings (EBIT) by 13%. This upgrade reflects confidence in Aegean’s ability to sustain growth despite current challenges in the global aviation market. For insights into global airline performance and trends, the International Air Transport Association (IATA) provides valuable context. ✈️
Aegean Airlines reported a 3% increase in consolidated revenue per available seat kilometer (RASK) and a 2% rise in ex-fuel cost per available seat kilometer (CASK). These gains were achieved even though 10 out of 66 narrow-body aircraft remain grounded due to GTF engine issues.
Greek Travel Demand Trends 2025
Because of a consistent rise in travel demand to Greece, particularly Athens, Aegean Airlines continues to thrive. Despite off-peak seasons, the country attracts tourists from Europe and markets like the USA. This trend is supported by Greece’s robust tourism sector, which is set for another record summer, according to Kathimerini. Therefore, Aegean’s increased capacity by 11% in a non-holiday quarter underscores the resilience of travel demand.
Capacity Increase Forecast Amid Challenges
Aegean Airlines plans a capacity increase of 5% in Q2 and 9% in Q3, following an 11% rise in Q1. The overall capacity growth towards Athens is projected at 7% and 5%, respectively. The Easter holiday timing in Q2 and sustained travel demand are expected to bolster revenue per unit, balancing potential downturns from reduced US traffic.
The airline’s strategic expansion continues, despite complexities like the re-establishment of flights to Israel. However, the summer outlook remains positive, driven by Greece’s economic momentum and Athens’ emergence as a year-round city break destination.
Operational Revenue Growth Prospects
Barclays has revised its annual operational earnings forecast for Aegean Airlines, predicting a 0.9% rise in revenue per unit, compared to an earlier forecast of a 0.7% decline. Besides that, net earnings benefited from a favorable €13 million forex variance, anticipated to partially reverse in Q2.
Despite challenges like GTF engine issues, Aegean Airlines effectively manages these hurdles, unlike several international carriers facing similar problems. The airline’s strong market position, favorable currency rates, fuel price trends, and strategic expansion into complementary activities are driving its positive momentum. For a broader perspective on the industry’s challenges and opportunities, refer to Reuters.
Potential risks include domestic disruptions, such as air traffic controller strikes earlier this year. Nevertheless, Aegean Airlines remains well-positioned to navigate these challenges and continue its growth trajectory. 🌍
