Morgan Stanley | Following a road show with the company’s management team in NY, Ross Law (analyst) reiterates his investment thesis: despite near-term headwinds, he believes the medium-term growth outlook remains attractive (5Y EPS of €23-28 and a mid-teens FCF CAGR).
As such, with the stock trading near cycle lows (9x MSe FY3 EV/EBIT) Ross reiterates Overweight (OW).
More specifically, the analyst highlights that: a) engine supply has not fully recovered, but the Outlook is no longer as risky, b) the management has confirmed margin expectations in the Airbus Commercial segment, c) within the next generation narrow bodies, they have also confirmed interest in the RISE open rotor given the engine’s potential to improve fuel burn rate, d) they have also reiterated the commitment around shareholder return… among others.
AIRBUS, OVERWEIGHT, €160
