TLDR
- Evercore ISI lifted Ryanair’s rating to “outperform” and increased its price target from $75 to $80
- Ryanair is the sole airline in Evercore’s coverage universe to receive upward EPS adjustments for 2026 and 2027
- Jet fuel crack spreads have reached 44% of the total barrel price — over twice the long-term historical average of 20-25%
- United, Delta, and American Airlines each experienced significant cuts to their EPS estimates from Evercore
- A discounted cash flow (DCF) analysis values Ryanair at an intrinsic €30.34 per share, compared to its recent closing price of €26.61—indicating a 12.3% discount
On Thursday, Evercore ISI upgraded Ryanair Holdings, shifting the stock’s rating from “In Line” to “outperform” and boosting its price target from $75 to $80.
Ryanair Holdings plc (RYAAY)
The firm cited Ryanair’s €1 billion net cash reserve and a 15% drop from its January peak as primary factors behind the upgrade.
This upgrade coincided with Evercore lowering estimates for most airlines it covers. Jet fuel crack spreads have spiked to 44% of the total Gulf Coast barrel price — more than twice the 20-25% long-term historical average.
Analyst Duane Pfennigwerth described this as a 2.8-sigma event, drawing parallels between the current market disruption and conditions in 2008 and the initial phase of the Ukraine conflict.
As of March 11, spot jet fuel prices were about 53% higher than the average for the first quarter so far. Evercore projects a roughly two-week delay in fuel cost impacts, leading to an estimated Q1 2026 Gulf Coast jet fuel price of $2.40 per gallon.
Ryanair’s 2026 EPS estimate was increased to $4.77 from $4.65, and its 2027 estimate to $5.75 from $5.65. It was the only airline in Evercore’s coverage to receive upward adjustments.
Rivals Take the Hit
The difference between Ryanair and its competitors was striking. United Airlines’ 2026 EPS estimate was cut sharply to $8.60 from $13. Delta’s estimate was reduced to $5.70 from $7, and American Airlines’ fell to -$0.36 from $2.
Ryanair’s 2026 net debt-to-EBITDAR ratio is -0.4x, the healthiest among Evercore’s covered airlines. JetBlue’s ratio is 13.7x, and American’s is 7.2x.
Evercore’s estimates are still below the market consensus for most airlines. Its $8.60 estimate for United is lower than the Street’s $12.91 consensus. Its Delta estimate of $5.70 is below the $6.99 consensus. For Ryanair, Evercore’s full-year 2026 estimate of $5.52 is nearly aligned with the $5.55 consensus.
Despite these challenges, demand in the airline sector remains robust. Evercore’s Airlines Survey increased by 6.2 points to 70.0 at the beginning of March, with the international segment rising from 62.5 to 75.
Passenger volume for the week ending March 10 was 2% higher than the same period last year and 5% above 2019 levels.
What the Valuation Says
A DCF analysis conducted by Simply Wall St pegs Ryanair’s intrinsic value at €30.34 per share. The stock’s recent closing price of €26.61 means it trades at a 12.3% discount to this intrinsic value.
Ryanair’s current price-to-earnings (P/E) ratio is 12.47x. This is higher than the airline industry average of 8.66x but lower than the peer group average of 17.24x.
Year-to-date, the stock has declined 10.4% and has dropped 5.6% in the past 30 days. However, it’s still up 31.1% over one year and 96.1% over three years.
Evercore’s full-year 2026 EPS estimate of $5.52 for Ryanair is nearly in line with the Street’s $5.55 consensus—an uncommon alignment in a coverage group where most airlines are seeing significant downward estimate revisions.
