With the jobs market apparently still running rampant—tech layoffs aside—it’s no real surprise to see some of those workers bucking for pay hikes. Especially when some of the companies involved are coming off record profitability. That’s what’s happening to Canadian airline stock Air Canada (TSE:AC), and it’s about to see some new costs going into the pockets of its employees. Investors weren’t exactly happy about that, though, and Air Canada shares were down fractionally in Tuesday afternoon’s trading.
Air Canada brought in an impressive 2023 but noted that it was going to have to limit future expectations in light of the new arrangements. Air Canada has over 5,000 pilots on its roster, and they’re eager to narrow the pay gap between themselves and pilots in the United States. Given that that gap measures between 50% and 300%, it’s not exactly surprising. Moreover, with other Canadian airlines offering pay raises to their own pilots, Air Canada is in a position where it will have to follow suit or risk watching talent jump ship.
Things Have Not Been Good Lately
The last few days haven’t been particularly good for Air Canada, either; with an active threat recently made against flight 8657 at Newark Airport, it’s easy to see why Air Canada would be on edge. The plane landed safely and passengers disembarked without incident, but it’s still not the kind of thing you want your airline connected to.
Meanwhile, it’s still smarting over a recent Canadian court decision that requires Air Canada to honor the terms of a bereavement leave ticket as set by a chatbot. While Air Canada tried to assert it wasn’t responsible for what said chatbot said, a court wasn’t convinced, and Air Canada had another check to write.
What Is the Price Target for the Air Canada Stock?
Turning to Wall Street, analysts have a Strong Buy consensus rating on AC stock based on eight Buys and one Hold assigned in the past three months, as indicated by the graphic below. After an 11.44% loss in its share price over the past year, the average AC price target of C$30.14 per share implies 68.03% upside potential.
