Qantas Airways Limited (QAN) AI Stock Analysis

• Market Cap: $15.32B
• Dividend Yield: 2.84%
• Average Volume (3M): 4.40M
• Price to Earnings (P/E): 12.1
• Beta (1Y): 1.15
• Revenue Growth: 9.24%
• EPS Growth: -7.82%
• Country: AU
• Employees: 20,000
• Sector: Industrials
• Sector Strength: 87
• Industry: Airlines, Airports & Air Services
• EPS (TTM): 0.63
• Shares Outstanding: 1,513,199,200
• 10 Day Avg. Volume: 5,042,566
• 30 Day Avg. Volume: 4,399,181
• PEG Ratio: -5.54
• Price to Book (P/B): 2.93
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 7.48
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $11.00
• Price Target Upside: 7.94% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 11

• Rating: 74 Outperform
• Price Target: AU$12.00 ▲(17.76%Upside)

Qantas Airways' overall stock score is driven by strong technical momentum and fair valuation. However, financial performance is hindered by profitability and leverage concerns. The absence of earnings call and corporate events data did not impact the score.

Positive Factors

Growth Initiatives

Qantas launched Project Sunrise, focusing on non-stop ultra-long-haul routes between Australia, UK, and US starting from 2025, which will enable a greater premium mix and strategic advantage over peers.

Market Position

Qantas has increased its market share in both the domestic and international markets over the pandemic due to consolidation in the sector and its stronger financial position.

Strategic Decisions

Exiting the Jetstar Asia business is seen as a positive move, demonstrating management discipline and reducing renewal capital expenses over time.

Negative Factors

Financial Performance

Jetstar Asia losses are likely worse than market expectations, impacting Qantas’ financial outlook.

Operational Challenges

A capacity reduction to Group International is expected due to industrial action on the Finnair wet lease.

Operational Efficiency

Manpower shortage continues to be a limiting factor in the recovery of Qantas’s capacity, driven by a tight labor market and surging travel demand.

Qantas Airways Limited Business Overview & Revenue Model

Company Description

Qantas Airways Limited (QAN) is Australia's largest domestic and international airline. Founded in 1920, Qantas is a major player in the aviation industry, operating a fleet that services both passenger and cargo transportation. The company is recognized for its premium airline services, providing a range of travel-related products and experiences. Qantas operates through several key segments, including Qantas Domestic, Qantas International, Jetstar Group (its low-cost carrier), and Qantas Loyalty, which manages its frequent flyer program.

How the Company Makes Money

Qantas Airways Limited generates revenue through multiple streams, with the primary sources being passenger ticket sales and freight services. The company earns significant income from its domestic and international flight operations, with additional revenue from its low-cost carrier, Jetstar. Ancillary services such as baggage fees, seat selection, and in-flight sales further contribute to its earnings. Qantas also benefits from its loyalty program, Qantas Frequent Flyer, which provides a steady income through partnerships with retailers, financial institutions, and other service providers. The company engages in strategic alliances and code-sharing agreements to enhance its network and revenue potential. Revenue is also supplemented through engineering services and the sale of frequent flyer points.

Qantas Airways Limited Financial Statement Overview

Summary

Qantas demonstrates strong revenue growth and operational efficiency. However, profitability is challenged with declining net profit and free cash flow margins. The balance sheet is highly leveraged, posing financial risk.

Income Statement

Qantas has shown significant improvement in revenue growth, with a 10.7% increase in 2024 compared to 2023. The gross profit margin increased to 53.0% in 2024, indicating improved operational efficiency. However, the net profit margin declined to 5.8% from 8.9% in 2023, suggesting challenges in converting revenue into profit. EBIT and EBITDA margins also showed a decline from the previous year, highlighting some pressure on core earnings.

Balance Sheet

The debt-to-equity ratio improved but remains high at 22.80, which indicates significant leverage and potential financial risk. Return on equity (ROE) is robust at 434.6%, driven by high net income relative to equity, but this is partly due to the low equity base. The equity ratio remains very low at 1.4%, showing limited equity cushion against liabilities.

Cash Flow

Free cash flow decreased significantly, with a 72.7% decline from 2023 to 2024. Operating cash flow remains strong relative to net income, indicating solid cash generation capabilities, despite challenges in maintaining free cash flow levels. The free cash flow to net income ratio is below 1, suggesting that not all earnings are translating into free cash flow.

Breakdown
TTM	Jun 2024	Jun 2023	Jun 2022	Jun 2021	Jun 2020
Income Statement		Total Revenue
22.94B	21.62B	19.52B	8.70B	5.38B	14.05B
	Gross Profit
7.52B	11.46B	10.97B	4.52B	-991.00M	4.12B
	EBIT
7.26B	2.18B	2.71B	-1.82B	-1.91B	-688.00M
	EBITDA
3.80B	3.90B	4.52B	928.00M	-176.00M	-334.00M
	Net Income Common Stockholders
1.30B	1.25B	1.75B	-860.00M	-1.69B	-1.96B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
2.34B	1.98B	3.17B	3.34B	2.22B	3.52B
	Total Assets
21.83B	20.56B	20.35B	19.65B	17.81B	20.03B
	Total Debt
7.23B	6.59B	6.73B	7.23B	8.23B	8.54B
	Net Debt
4.89B	4.87B	3.56B	3.89B	6.01B	5.01B
	Total Liabilities
21.09B	20.27B	20.34B	19.84B	17.36B	18.50B
	Stockholders Equity
738.00M	289.00M	5.00M	-197.00M	440.00M	1.52B
Cash Flow		Free Cash Flow
1.43B	680.00M	2.49B	1.75B	-1.15B	-514.00M
	Operating Cash Flow
4.17B	3.35B	5.05B	2.65B	-407.00M	1.03B
	Investing Cash Flow
-2.87B	-2.89B	-2.59B	-225.00M	-701.00M	-1.52B
	Financing Cash Flow
-521.00M	-2.01B	-2.63B	-1.31B	-181.00M	1.85B

Qantas Airways Limited Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 10.19
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AU:QAN, the sentiment is Neutral. The current price of 10.19 is below the 20-day moving average (MA) of 10.46, above the 50-day MA of 9.53, and above the 200-day MA of 8.61, indicating a neutral trend. The MACD of 0.26 indicates Positive momentum. The RSI at 49.36 is Neutral, neither overbought nor oversold. The STOCH value of 26.22 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for AU:QAN.

Qantas Airways Limited Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
QAN	74 Outperform	$15.32B	12.08	321.42%	2.84%	9.24%	-7.82%
AQZ	73 Outperform	AU$408.82M	6.48	15.44%	―	16.98%	12.16%
Sector *	66 Neutral	$4.47B	12.22	5.40%	3.65%	4.14%	-12.00%

Qantas Airways Limited Corporate Events

Qantas Group to Close Jetstar Asia Amid Strategic Restructure

Qantas Group has announced the closure of its Singapore-based low-cost subsidiary, Jetstar Asia, as part of a strategic restructure to support its fleet renewal program. This move will recycle up to $500 million in capital, allowing the redeployment of 13 Airbus A320 aircraft to Australia and New Zealand, creating local jobs and offering more low fares. The decision comes amid rising costs and competition in the region, with Jetstar Asia expected to post a $35 million EBIT loss this financial year. The closure will impact 16 intra-Asia routes but not Jetstar Airways’ or Jetstar Japan’s operations. Qantas will provide support to affected employees and customers, and the closure will result in financial impacts estimated at $175 million.

The most recent analyst rating on (AU:QAN) stock is a Buy with a A$8.50 price target. To see the full list of analyst forecasts on Qantas Airways Limited stock, see the AU:QAN Stock Forecast page.

Qantas Airways Updates Sydney Registry Office Address

Qantas Airways Limited announced a change in the address of its registry office in Sydney, effective from April 14, 2025. The registry, managed by MUFG Corporate Markets (AU) Limited, has moved to a new location at Liberty Place, Level 41, 161 Castlereagh St, Sydney NSW 2000. This change does not affect the mailing address, email, or telephone contact details for Qantas shareholders, ensuring continuity in communication and operations.

Qantas Airways Announces Cessation of Performance Rights

Qantas Airways Limited announced the cessation of 204,464 performance rights due to the lapse of conditional rights, as the conditions were not met by the specified date. This cessation reflects on the company’s capital management strategies and may impact stakeholders’ perception of the company’s operational performance and future growth prospects.

Qantas Issues Performance Rights to Employees

Qantas Airways Limited announced the issuance of 121,000 performance rights under an employee incentive scheme. These securities are unquoted and subject to transfer restrictions, reflecting the company’s strategy to incentivize and retain key personnel, potentially impacting its operational efficiency and stakeholder engagement.

Qantas Airways Appoints Dion Weisler as New Director

Qantas Airways Limited has announced the appointment of Dion Weisler as a new director, effective from March 31, 2025. Weisler holds 20,000 ordinary shares through Dish Nominees Pty Ltd, a private investment entity for his family. This appointment is part of Qantas’s ongoing efforts to strengthen its leadership team, potentially impacting its strategic direction and stakeholder interests.

Qantas Announces Strategic Board Changes with New Appointment

Qantas Airways Limited has announced the appointment of Dion Weisler as an independent Non-Executive Director, emphasizing its commitment to board renewal and enhancing its governance. Weisler, with his extensive experience in global technology companies, is expected to contribute significantly to Qantas’s digital transformation initiatives and help navigate challenges such as AI and cyber threats. Additionally, Todd Sampson will retire from the board after over a decade of service, marking a period of significant board refreshment. These changes are part of Qantas’s strategy to strengthen its position and regain trust as a leading Australian brand.

Qantas Maintains Steady Shareholding Control

Qantas Airways Limited has announced that there has been no change in the aggregated percentage of voting shares controlled by its entities, maintaining a 0.05% stake. This stability in shareholding indicates a steady control over its voting rights, suggesting no immediate impact on its corporate governance or stakeholder interests.