Ryanair Holdings (NASDAQ:RYAAY) (GB:0A2U) announced its first regular dividend after its profits surged on record summer traffic. The company reported profit after tax of €2.18 billion in the first half earnings report of FY24, marking a 59% increase over last year.
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The airline confirmed its plan to initiate an inaugural annual dividend of €400 million, or €0.35 per share, in the coming year. This will be equally divided into interim and final dividends, payable in February 2024 and September 2024. From FY25 onwards, it will distribute around 25% of after-tax profits through regular dividends.
Ryanair Holdings is a budget airline company with a presence in approximately 40 countries in Europe. The airline operates a vast network, with over 3,000 daily flights.
Strong Numbers and a Positive Outlook
In the first half of the fiscal year, total revenues increased by 30% to €8.6 billion. This was driven by an 11% growth in its traffic to 105.4 million passengers, fuelled by a strong Easter season and record summer demand. The airline also increased its average fares by 24% to €58. Ryanair’s operating costs grew by 24% to €6.2 billion as compared to the same period a year ago, due to higher fuel costs, staff costs, and other airport charges.
Talking about the outlook, Ryanair projected an after-tax profit for the full year ranging from €1.85 billion to €2.05 billion, surpassing its prior record of €1.45 billion achieved in 2018. The company expects its fares to grow by a “mid-teens percentage” in Q3 2024, as air capacity in Europe remains below pre-COVID levels.
What is the Target Price for Ryanair Stock?
Post-results, the shares traded up by 4.23% yesterday. Year-to-date, the stock has gained over 30% in trading.
On TipRanks, 0A2U stock has received a Moderate Buy rating based on two Buy recommendations from Bernstein and Deutsche Bank. Today, analyst Alex Irving from Bernstein reiterated his Buy rating on the stock, predicting an upside of 37% in the share price. Similarly, Deutsche Bank’s analyst Jaime Rowbotham also maintained his Buy rating on the stock yesterday.
The Ryanair share price target is $133, which implies an upside of 37% from the current trading price.
