11.04.2019 kl 11:14 7128

Beklager rotet.)

Costs focus. Norwegian Air Shuttle has guided for a 2019 CASK of NOK0.295–0.3, assuming NOK2bn cost cuts – which it needs to secure its short- and long-term competiveness. Hence, any update here and on the situation following the recent Boeing 737 MAX accident will be key focus points in our view. Our 2019 CASK forecast of NOK0.295 (excluding fuel) assumes that all wet-lease costs related to the 737 MAX situation will be covered by Boeing.
Capex guidance seen lower. We expect the 2019 and 2020 capex guidance to be lowered to cUSD1.8bn (USD2bn) and cUSD2bn (USD2.4bn), respectively, on the back of the revised delivery schedule for the Airbus order, as announced yesterday.
Estimates. We have cut our 2019e net profit by cNOK530m and 2020e by cNOK340m following the weaker than expected traffic statistics, higher fuel price assumptions, and revised delivery scheduled for the Airbus order.
Attractive valuation; resuming coverage with a BUY and NOK65 target price. Our updated SOTP indicates a value of NOK47/share, excluding future deliveries and NOK81/share including, while its historical P/E adjusted for IFRS16 and the value of Bank Norwegian points to a value of NOK65/share. Key near-term share price triggers include asset sales and more clarity on the potential costs of the Boeing 737 MAX issue.

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