On Wednesday, JPMorgan (NYSE:JPM) maintained its Overweight rating on shares of EasyJet Plc. (EZJ:LN) (OTC: ESYJY) with a price target of GBP6.60. The firm anticipates potential earnings upgrades for the airline, citing expectations of about 10% higher profit before tax (PBT) for September 2025 compared to the Bloomberg consensus. This outlook is based on conservative estimates for pricing growth.
The airline's performance is supported by the expansion of its Holidays segment and the recovery from the previous impact of Middle East tensions. Despite a year-to-date performance that has not seen any gains, EasyJet's resilience in pricing and earnings stands out against its competitors. JPMorgan sees the current price-to-earnings (P/E) ratio of 7 for the expected 25% earnings per share (EPS) growth in September 2025 as an attractive proposition for investors.
JPMorgan has placed EasyJet on a Positive Catalyst Watch, indicating a belief that there could be favorable events on the horizon that may lead to an upward revision in earnings forecasts. This is based on the airline's solid fundamentals and potential for continued growth in its Holidays division.
The firm's analysis suggests that EasyJet's current valuation does not fully reflect its earnings potential, especially when compared to its industry peers. With the airline's shares remaining stable year-to-date, JPMorgan's position indicates confidence in EasyJet's financial prospects moving forward.
In summary, JPMorgan's outlook for EasyJet is positive, with the firm expecting the airline to outperform market expectations. The Overweight rating and GBP6.60 price target reflect this optimism, as the firm anticipates EasyJet to experience significant earnings growth by September 2025.
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