Qantas Airways Limited (AU:QAN)
ASX:QAN
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Qantas Airways Limited
(Sydney:QAN)
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Rating:58Neutral
Price Target:
AU$10.50
▲(15.64% Upside)
Action:Reiterated
Date:04/09/26
The score is held back mainly by financial risk (very high leverage and sharply weaker free cash flow) and a mixed technical setup with a negative MACD and price below key longer-term averages. These are partly offset by attractive valuation (low P/E and solid dividend yield) and a generally positive earnings call emphasizing profit/cash flow strength and shareholder distributions, despite notable near-term cost headwinds.
Positive Factors
Domestic network strength
Sustained domestic outperformance reflects resilient demand, pricing power and network scale that drive higher unit economics. A strong domestic margin (18%) and expanding capacity underpin durable cash generation and earnings stability, reducing reliance on more volatile international markets.
Negative Factors
Very high leverage
Extremely elevated leverage constrains financial flexibility and increases refinancing and interest-rate vulnerability. With net debt at multi-billion levels, balance sheet risk can limit capacity to absorb shocks, restrict capital allocation choices and pressure credit metrics over the medium term.
Read all positive and negative factors
Positive Factors
Negative Factors
Domestic network strength
Sustained domestic outperformance reflects resilient demand, pricing power and network scale that drive higher unit economics. A strong domestic margin (18%) and expanding capacity underpin durable cash generation and earnings stability, reducing reliance on more volatile international markets.
Read all positive factors
Qantas Airways Limited (QAN) vs. iShares MSCI Australia ETF (EWA)
Market Cap
AU$15.12B
Dividend Yield4.9%
Average Volume (3M)5.33M
Price to Earnings (P/E)9.5
Beta (1Y)1.31
Revenue Growth6.88%
EPS Growth26.75%
CountryAU
Employees20,000
SectorIndustrials
Sector Strength72
IndustryAirlines, Airports & Air Services
Share Statistics
EPS (TTM)1.06
Shares Outstanding1,513,199,200
10 Day Avg. Volume4,660,879
30 Day Avg. Volume5,327,379
Financial Highlights & Ratios
PEG Ratio0.27
Price to Book (P/B)21.30
Price to Sales (P/S)0.70
P/FCF Ratio49.48
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
AU$11.00Price Target Upside21.15% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering11
EPS Forecast (FY)0.94
Revenue Forecast (FY)AU$25.66B
Qantas Airways Limited Business Overview & Revenue Model
Company Description
Headquartered in Mascot, Australia, Qantas Airways Limited is an airline providing extensive air transportation services, both domestically within Australia and internationally. Its business is organized into several key segments: Qantas Domestic,...
How the Company Makes Money
Qantas makes money primarily by selling air travel and travel-related services across its brands and business units. The largest revenue stream is passenger revenue: fares paid by leisure and corporate customers on domestic and international route...
Qantas Airways Limited Earnings Call Summary
Earnings Call Date:Feb 25, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Aug 27, 2026
Earnings Call Sentiment Positive
The call conveyed a predominantly positive operational and financial picture: solid underlying profit and EPS growth, strong operating cash flow, accelerating fleet renewal with tangible benefits (notably at Jetstar), robust domestic performance and continued Loyalty momentum, alongside increased shareholder distributions. However, the positive narrative is tempered by meaningful near-term cost pressures—engineering, labor (including Same Job Same Pay), higher depreciation from accelerated fleet investment, unfavorable FX, and a weaker-than-expected International EBIT performance. Management has provided sensible mitigation actions (capacity redeployments, portfolio rationalization, focus on capital allocation) and clear guidance on capex and RASK outlooks.Positive Updates
Underlying Profit and EPS Growth
Underlying profit before tax (H1 FY26) was $1.46 billion, up 5% year-on-year. Underlying earnings per share were $0.68, up 7% versus the prior comparable half.
Negative Updates
Group International Underperformance
Group International (ex Jetstar Asia/Japan) underlying EBIT was down 6% year-on-year, driven by cost escalations (higher engineering, operational wages and training costs for new aircraft). International capacity rose 3%, but costs pressured margins.
Read all updates
Q2-2026 Updates
Positive
Negative
Underlying Profit and EPS Growth
Underlying profit before tax (H1 FY26) was $1.46 billion, up 5% year-on-year. Underlying earnings per share were $0.68, up 7% versus the prior comparable half.
Read all positive updates
Company Guidance
Guidance highlights: Group RASK is expected to increase ~3% versus last year (Group International RASK +1% to +3%), entry‑into‑service and fleet transition costs are expected to rise by ~$20m versus H2‑FY25, and the gross impact of Same Job Same Pay for FY26 is now ~ $95m (≈$15m higher versus H2‑FY25) to be mitigated over time; Qantas Loyalty is guided to grow underlying EBIT by 10–12% for FY26 and net freight revenue in H2‑FY26 is expected to be in line with H2‑FY25. Capital guidance is net CapEx $4.1–4.3bn for FY26 and $5.1–5.4bn for FY27 (H1 net CapEx $1.8bn; H1 fleet/other investment $1.8bn, 18 aircraft added, 9 new), net debt closed the half at $5.6bn (bottom of FY26 target range $5.6–7.0bn), and the Board approved an interim shareholder distribution of up to $450m (fully franked base dividend $300m, +$50m, plus an on‑market buyback up to $150m).Qantas Airways Limited Financial Statement Overview
Summary
Income Statement
65
Positive
Balance Sheet
40
Negative
Cash Flow
55
Neutral
| Breakdown | TTM | Jun 2025 | Jun 2024 | Jun 2023 | Jun 2022 | Jun 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 24.41B | 23.82B | 21.62B | 19.52B | 8.70B | 5.38B |
| Gross Profit | 6.61B | 7.95B | 11.46B | 10.97B | 4.52B | -991.00M |
| EBITDA | 4.28B | 4.12B | 3.90B | 4.60B | 945.00M | 53.00M |
| Net Income | 1.61B | 1.60B | 1.25B | 1.75B | -860.00M | -1.69B |
Balance Sheet | ||||||
| Total Assets | 23.89B | 23.36B | 20.56B | 20.35B | 19.65B | 17.81B |
| Cash, Cash Equivalents and Short-Term Investments | 1.86B | 2.21B | 1.98B | 3.17B | 3.34B | 2.22B |
| Total Debt | 9.44B | 7.96B | 6.59B | 6.73B | 7.23B | 8.23B |
| Total Liabilities | 22.55B | 22.57B | 20.27B | 20.34B | 19.84B | 17.36B |
| Stockholders Equity | 1.34B | 778.00M | 289.00M | 5.00M | -197.00M | 440.00M |
Cash Flow | ||||||
| Free Cash Flow | -466.00M | 335.00M | 680.00M | 2.49B | 1.75B | -1.15B |
| Operating Cash Flow | 3.87B | 4.25B | 3.35B | 5.05B | 2.65B | -407.00M |
| Investing Cash Flow | -4.10B | -3.81B | -2.89B | -2.59B | -225.00M | -701.00M |
| Financing Cash Flow | -179.00M | 42.00M | -2.01B | -2.63B | -1.31B | -181.00M |
Qantas Airways Limited Technical Analysis
Positive
9.08
Price Trends
8.98
Positive
9.15
Positive
9.67
Positive
Market Momentum
0.30
Negative
70.35
Negative
89.52
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AU:QAN, the sentiment is Positive. The current price of 9.08 is below the 20-day moving average (MA) of 9.39, above the 50-day MA of 8.98, and below the 200-day MA of 9.67, indicating a bullish trend. The MACD of 0.30 indicates Negative momentum. The RSI at 70.35 is Negative, neither overbought nor oversold. The STOCH value of 89.52 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for AU:QAN.
Qantas Airways Limited Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
72 Outperform | AU$7.09B | 23.91 | 7.42% | 4.29% | 4.70% | -20.38% | |
69 Neutral | AU$1.20B | 18.11 | 6.99% | 4.06% | 10.31% | 33.06% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% | |
59 Neutral | AU$2.13B | 5.52 | -65.99% | ― | ― | ― | |
58 Neutral | AU$15.12B | 9.47 | 151.46% | 4.90% | 6.88% | 26.75% | |
58 Neutral | AU$9.05B | 41.46 | 7.13% | 2.07% | 18.00% | -2.14% | |
56 Neutral | AU$80.53M | -1.08 | -18.72% | 2.40% | 18.00% | -222.55% |
* Industrials Sector Average
AU:QAN
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Qantas Airways Limited Corporate Events
Qantas Reports Lapse of 159,078 Performance Rights in Incentive Plan
May 7, 2026
Qantas Airways Limited has reported the lapse of 159,078 performance rights, identified under the ASX security code QANAA, after the conditions attached to these rights were not satisfied or became incapable of being met as at March 31, 2026. The ...
Qantas Extends Network Capacity Cuts While Boosting Europe Flights
Apr 30, 2026
Qantas Airways and its low-cost unit Jetstar are extending previously announced schedule changes into the first quarter of FY27, as the group works to manage the impact of the Middle East conflict, elevated fuel prices and strong demand for travel...
Qantas Raises FY26 Fuel Cost Outlook and Cuts Capacity Amid Middle East Conflict
Apr 13, 2026
Qantas Airways has issued a market update outlining the impact of the Middle East conflict on its FY26 outlook, highlighting a sharp increase in jet fuel costs as refining margins have surged and pushed expected second-half fuel expenses to betwee...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.