TUI AG, the Consumer Cyclical sector company, was revisited by a Wall Street analyst today. Analyst James Wheatcroft from Jefferies maintained a Hold rating on the stock and has a €8.20 price target.
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James Wheatcroft has given his Hold rating due to a combination of factors that reflect both positive and cautious elements regarding TUI AG’s financial outlook. The company’s new guidance for FY26 shows a promising increase in EBIT expectations, surpassing current consensus estimates. Additionally, TUI AG has introduced a new dividend policy, which includes a payout ratio that could attract income-focused investors.
Despite these positive developments, Wheatcroft remains cautious due to potential reinvestment risks across various business units. While the company’s valuation appears attractive compared to historical levels, and the balance sheet is robust, there are concerns about the need for further investment to maintain competitiveness. Wheatcroft prefers companies like Jet2, which offer better-invested propositions and clearer growth trajectories, suggesting that TUI AG’s current position warrants a Hold rating rather than a more aggressive Buy recommendation.