Deutsche Lufthansa (LHA) AI Stock Analysis

• Market Cap: €9.33B
• Dividend Yield: 3.63%
• Average Volume (3M): 3.76M
• Price to Earnings (P/E): 5.2
• Beta (1Y): 1.31
• Revenue Growth: 5.95%
• EPS Growth: 82.99%
• Country: DE
• Employees: 102,574
• Sector: Industrials
• Sector Strength: 72
• Industry: Airlines, Airports & Air Services
• EPS (TTM): 0.81
• Shares Outstanding: 1,200,249,100
• 10 Day Avg. Volume: 3,200,762
• 30 Day Avg. Volume: 3,758,007
• PEG Ratio: -0.30
• Price to Book (P/B): 0.64
• Price to Sales (P/S): 0.20
• P/FCF Ratio: -1.23K
• 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: €7.26
• Price Target Upside: -12.21% Downside
• Rating Consensus: Hold
• Number of Analyst Covering: 10
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 76 Outperform
• Price Target: €9.50 ▲(14.87% Upside)

Deutsche Lufthansa's strong financial recovery and bullish technical indicators are the primary drivers of its stock score. The undervaluation based on the P/E ratio and attractive dividend yield further enhance its investment appeal. However, the reliance on debt and potential industry-specific risks should be monitored.

Positive Factors

Revenue Growth

The 19.3% revenue growth indicates robust demand recovery and effective business operations, enhancing market position and competitiveness.

Cash Flow Generation

Significant improvement in cash flow generation strengthens financial flexibility, supporting strategic investments and debt reduction.

Operational Efficiency

Improved EBIT and EBITDA margins demonstrate enhanced operational efficiency, contributing to sustainable profitability and competitive advantage.

Negative Factors

Debt Reliance

High reliance on debt could pose financial risks during economic downturns, potentially limiting strategic flexibility and increasing interest costs.

Low Equity Ratio

A low equity ratio indicates vulnerability to financial instability, affecting long-term sustainability and resilience against market fluctuations.

Competitive Industry

Operating in a highly competitive and economically sensitive industry could pressure margins and growth, requiring strategic agility and cost management.

Deutsche Lufthansa Business Overview & Revenue Model

Company Description

Deutsche Lufthansa AG operates as an aviation company in Germany and internationally. The company's Network Airlines segment offers passenger services. Its Eurowings segment provides passenger services through a route network of more than 100 destinations in over 50 countries. The company's Logistics Business segment offers transport services for various cargoes, including general cargo, dangerous goods, valuables, vulnerable, perishables, live animals, courier, emergency, airmail/e-commerce, and temperature sensitive goods services approximately 300 destinations in 100 countries. Its Maintenance, Repair and Overhaul Services (MRO) segment provides maintenance, repair, and overhaul services for civilian commercial aircraft serving original equipment manufacturers and aircraft leasing companies, operators of VIP jets, and airlines. The company's Catering Business segment engages in-flight services and convenience retail, as well as other areas, such as retail and food producers. As of December 31, 2021, it had a fleet of 713 aircraft. Deutsche Lufthansa AG was founded in 1926 and is headquartered in Cologne, Germany.

How the Company Makes Money

Lufthansa generates revenue primarily through the sale of passenger tickets and cargo services. Passenger revenues are derived from ticket sales for domestic and international flights, with additional income from ancillary services such as baggage fees, in-flight sales, and loyalty programs. Cargo services contribute significantly to revenue, with Lufthansa Cargo transporting goods and freight globally. The company also earns income through its MRO services, providing maintenance and technical support to other airlines and operators. Strategic partnerships and alliances, such as membership in the Star Alliance, enhance Lufthansa's network reach and customer base, further driving revenue growth. Additionally, the airline benefits from fuel hedging strategies and effective cost management, which play crucial roles in maintaining profitability in a highly competitive industry.

Deutsche Lufthansa Financial Statement Overview

Summary

Deutsche Lufthansa shows strong revenue growth and improved profitability, but high leverage and declining free cash flow pose risks. Continued focus on cost management and cash flow improvement is crucial.

Income Statement

Deutsche Lufthansa has shown a strong recovery in its income statement metrics. The TTM (Trailing-Twelve-Months) revenue growth rate is impressive at 82.2%, indicating a robust recovery post-pandemic. Gross profit margin and net profit margin have improved over the years, reflecting better cost management and profitability. However, EBIT and EBITDA margins have seen some fluctuation, suggesting potential volatility in operational efficiency.

Balance Sheet

The balance sheet shows a moderate level of stability. The debt-to-equity ratio has improved from previous years but remains relatively high at 1.36, indicating significant leverage. Return on equity is strong at 16.68%, showing effective use of equity to generate profits. The equity ratio is stable, reflecting a balanced asset structure.

Cash Flow

Cash flow metrics present a mixed picture. While operating cash flow remains healthy, the free cash flow has seen a significant decline, with a negative growth rate of -74.02% in the TTM period. The operating cash flow to net income ratio is stable, but the free cash flow to net income ratio is low, indicating potential challenges in converting profits into free cash.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	39.09B	37.58B	35.44B	30.89B	16.81B	13.59B
Gross Profit	5.50B	4.83B	5.24B	4.62B	-3.00M	-2.98B
EBITDA	4.66B	3.60B	5.33B	3.85B	31.00M	-5.49B
Net Income	1.64B	1.38B	1.67B	791.00M	-2.19B	-6.72B
Balance Sheet
Total Assets	48.83B	48.16B	46.16B	44.26B	43.49B	40.07B
Cash, Cash Equivalents and Short-Term Investments	9.38B	8.49B	8.27B	8.30B	7.67B	5.46B
Total Debt	14.46B	14.23B	13.95B	15.17B	16.69B	15.38B
Total Liabilities	37.41B	36.56B	36.45B	35.78B	39.00B	38.69B
Stockholders Equity	11.36B	11.54B	9.66B	8.40B	4.45B	1.35B
Cash Flow
Free Cash Flow	639.00M	-6.00M	659.00M	2.66B	-700.00M	-3.58B
Operating Cash Flow	4.36B	3.89B	4.71B	5.17B	618.00M	-2.33B
Investing Cash Flow	-3.21B	-2.33B	-2.94B	-3.44B	-3.02B	-2.34B
Financing Cash Flow	-1.19B	-1.45B	-2.07B	-2.27B	2.87B	5.08B

Deutsche Lufthansa Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 8.27
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DE:LHA, the sentiment is Positive. The current price of 8.27 is above the 20-day moving average (MA) of 7.84, above the 50-day MA of 7.53, and above the 200-day MA of 7.16, indicating a bullish trend. The MACD of 0.20 indicates Negative momentum. The RSI at 65.15 is Neutral, neither overbought nor oversold. The STOCH value of 94.89 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for DE:LHA.

Deutsche Lufthansa Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
LHA	76 Outperform	€9.33B	5.25	15.13%	3.63%	5.95%	82.99%
8TRA	76 Outperform	€13.60B	7.64	10.20%	5.79%	-7.11%	-30.83%
FRA	73 Outperform	€6.93B	17.53	9.56%	―	0.11%	2.58%
SIX3	69 Neutral	€3.16B	8.89	13.91%	5.23%	8.60%	20.38%
SIX2	67 Neutral	€3.16B	12.31	13.91%	3.84%	8.60%	20.38%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
HHFA	57 Neutral	€2.07B	58.87	5.78%	0.47%	13.44%	113.13%