Simply way way too cheap, hence the big share buy back, value at just 5x P/E, 1.5x EBITDA..8 Nov 2024 17:15
If you read todays report, pretty much every single KPI is up, a breath of fresh air in todays market.
And then you look at the valuation, and it's totally out of sync with anything else out there, this has been evident for a while now.
Average FTSE PE is 15, average airline PE is similar if not higher. Eg RR is at 20x PE, even Easyjet is at 11x, even at just 10x PE and IAG should be double here.
IAG P/E is now under 5, which is a total joke, hence the big share buyback, and no doubt more to come.
EBITDA for the 1st 9 months of 2024 was over £6 Billion, with a market cap of just £11 Billion LOL, yes quite staggering, so it's trading at around 1.5x EBITDA, again totally staggering, when many other businesses are at many multiples.
Basically they are trading at an absolute pittance, a £30 Billion+ revenue company, in the FTSE 100, with massive profits and big margins, with huge free cash flows, with a market cap of just £11 Billion.
I agree, once the institutions start loading up, along with all the share buy backs, and dividends to come, it's heading one way, in 12 months, back towards previous highs no doubt.
Rolls Royce did 230p to 570p in the last 12 months, IMO we will be seeing something similar here. Big institutions will drive this up, just like RR.