DBS analyst Tabitha Foo maintained a Hold rating on Deutsche Lufthansa (0H4A – Research Report) today and set a price target of €7.00.
Tabitha Foo’s rating is based on a combination of factors that reflect both the strengths and challenges facing Deutsche Lufthansa. The company has shown solid performance in its Cargo and MRO segments, which have helped mitigate losses in its Passenger Airlines segment. Despite this, the visibility for the third quarter is clouded by demand concerns and shorter booking windows, which contribute to a cautious outlook.
Additionally, while Lufthansa holds a strong competitive position with its multi-brand strategy and diversified operations, it faces ongoing operational challenges. These include unscheduled engine maintenance and delayed deliveries, alongside cost pressures such as rising personnel expenses. Although management remains confident in achieving EBIT growth, macroeconomic weaknesses and geopolitical tensions could impact travel demand. These factors, combined with persistent cost inflation and airport capacity constraints, underpin the Hold rating, suggesting a balanced view of potential risks and opportunities.
Foo covers the Industrials sector, focusing on stocks such as Delta Air Lines, United Airlines Holdings, and Qantas Airways Limited. According to TipRanks, Foo has an average return of -0.3% and a 41.18% success rate on recommended stocks.
In another report released yesterday, Morgan Stanley also maintained a Hold rating on the stock with a €4.85 price target.