Analyst Thomas Fitzgerald CFA of TD Cowen maintained a Buy rating on Air Canada, retaining the price target of C$22.00.
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Thomas Fitzgerald CFA has given his Buy rating due to a combination of factors that suggest long-term growth potential for Air Canada. Despite some expected delivery delays that may temporarily affect efficiency and scale benefits, the airline is projected to grow its capacity significantly over the next few years, aligning with pre-pandemic levels by the end of 2026. This capacity growth, coupled with the potential for increased revenue per available seat mile (RASM), supports a positive outlook.
Additionally, Air Canada’s strategic initiatives, such as reducing its share count and maintaining a strong balance sheet, position it well to adapt to changing economic conditions. While there are some near-term challenges, including labor contracts and infrastructure costs, the overall financial health and diverse revenue streams of the company provide a solid foundation for future performance. Consequently, the Buy rating is maintained with a price target of C$22, reflecting confidence in the company’s ability to achieve its long-term goals.
In another report released yesterday, Stifel Nicolaus also maintained a Buy rating on the stock with a C$24.00 price target.