Air New Zealand Forecasts Largest Annual Loss in Four Years
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 45 minutes ago
0mins
Should l Buy AIR?
Source: Newsfilter
- Annual Loss Forecast: Air New Zealand anticipates a pre-tax loss between NZ$340 million and NZ$390 million, a stark contrast to last year's profit of NZ$189 million, highlighting the severe impact of the Middle East conflict on the airline industry.
- Soaring Fuel Costs: The ongoing conflict has driven jet fuel prices to between $150 and $200 per barrel, with fuel accounting for up to a quarter of operating expenses, thereby exacerbating the financial strain on the airline.
- Increased Fuel Consumption: The airline expects to consume approximately 4.1 million barrels of fuel from January to June, leading to a fuel bill of NZ$980 million in the second half of the financial year, which is 32% higher than previously predicted in February, indicating significant cost control challenges.
- Capacity Adjustments and Fare Increases: Despite having reduced overall capacity three times and implemented fare increases, the airline continues to face negative impacts from a slowdown in booking momentum and weak domestic and trans-Tasman demand, which further complicates its financial outlook.
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Analyst Views on AIR
Wall Street analysts forecast AIR stock price to fall
6 Analyst Rating
5 Buy
1 Hold
0 Sell
Strong Buy
Current: 111.510
Low
99.00
Averages
106.80
High
121.00
Current: 111.510
Low
99.00
Averages
106.80
High
121.00
About AIR
AAR CORP. is a global aerospace and defense aftermarket solutions company with operations in over 20 countries. The Company supports commercial and government customers through four operating segments: Parts Supply, Repair & Engineering, Integrated Solutions, and Expeditionary Services. Parts Supply segment primarily consists of its sales of used serviceable material, including aircraft, engine and airframe parts and components and distribution of new parts. Repair & Engineering segment primarily consists of its maintenance, repair, and overhaul (MRO) services across airframes and components. Integrated Solutions segment primarily consists of its fleet management and operations of customer-owned aircraft, customized performance-based supply chain logistics programs and others. Expeditionary Services segment primarily consists of products and services supporting the movement of equipment and personnel by the United States and foreign governments and non-governmental organizations.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Air New Zealand Forecasts Largest Annual Loss in Four Years
- Annual Loss Forecast: Air New Zealand anticipates a pre-tax loss between NZ$340 million and NZ$390 million, a stark contrast to last year's profit of NZ$189 million, highlighting the severe impact of the Middle East conflict on the airline industry.
- Soaring Fuel Costs: The ongoing conflict has driven jet fuel prices to between $150 and $200 per barrel, with fuel accounting for up to a quarter of operating expenses, thereby exacerbating the financial strain on the airline.
- Increased Fuel Consumption: The airline expects to consume approximately 4.1 million barrels of fuel from January to June, leading to a fuel bill of NZ$980 million in the second half of the financial year, which is 32% higher than previously predicted in February, indicating significant cost control challenges.
- Capacity Adjustments and Fare Increases: Despite having reduced overall capacity three times and implemented fare increases, the airline continues to face negative impacts from a slowdown in booking momentum and weak domestic and trans-Tasman demand, which further complicates its financial outlook.
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- Leadership Insights: AAR's senior leadership team will outline the company's growth strategy and financial targets during the event, showcasing its leadership position and market potential in the aviation services sector.
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Air New Zealand Forecasts Largest Annual Loss in Four Years
- Annual Loss Forecast: Air New Zealand anticipates a pre-tax loss between NZ$340 million and NZ$390 million, a stark contrast to last year's profit of NZ$189 million, highlighting the severe impact of the Middle East conflict on the airline industry.
- Soaring Fuel Costs: The ongoing conflict has driven jet fuel prices to between $150 and $200 per barrel, with fuel accounting for up to a quarter of operating expenses, thereby exacerbating the financial strain on the airline.
- Increased Fuel Consumption: The airline expects to consume approximately 4.1 million barrels of fuel from January to June, leading to a fuel bill of NZ$980 million in the second half of the financial year, which is 32% higher than previously predicted in February, indicating significant cost control challenges.
- Capacity Adjustments and Fare Increases: Despite having reduced overall capacity three times and implemented fare increases, the airline continues to face negative impacts from a slowdown in booking momentum and weak domestic and trans-Tasman demand, which further complicates its financial outlook.
See More
NYSE Provides Daily Pre-Market Update Amid Market Insights
- Market Update: Stocks are down on Tuesday morning following the Bureau of Labor Statistics' release of the April CPI report, indicating inflation concerns that could impact investor confidence and trading strategies.
- Disney Event: ESPN Chair Jimmy Pitaro will join NYSE Live from the Disney Upfront to discuss the significance of broadcasting Super Bowl LXI, marking a first for the network and potentially enhancing Disney's brand market influence.
- Brand Promotion: Disney's Chief Marketing Officer Asad Ayaz will explain how the event celebrates Disney fandom, further strengthening brand loyalty and consumer engagement in a competitive landscape.
- Milestone Celebration: AAR Corp celebrates its 45th anniversary of listing and 70th anniversary of founding at the NYSE, showcasing the company's sustained performance in capital markets, which may attract more investor interest in its future growth.
See More
AAR Corp. Outlines Strategy at 2026 Investor Day
- Strategic Vision Presentation: At the 2026 Investor Day, AAR Corp. emphasized its unique aviation aftermarket platform, which is expected to generate consistent above-market sales growth and margin expansion, thereby enhancing shareholder value.
- Financial Framework Update: The company introduced its updated three-year financial framework aimed at driving higher capital returns and improved margins by capturing core business and pursuing new opportunities.
- Leadership Insights: AAR's senior leadership team will outline the company's growth strategy and financial targets during the event, showcasing its leadership position and market potential in the aviation services sector.
- Investor Engagement: The event includes a Q&A session, allowing investors to access presentation materials through a live webcast, further informing them about the company's future direction and strategic implementation.
See More
AirAsia Orders 150 Airbus A220-300 Jets in Historic $19 Billion Deal
- Historic Order: AirAsia announced a landmark order for 150 Airbus A220-300 jets at an Airbus factory in Quebec, valued at approximately $19 billion, marking the largest single order for the A220 series, demonstrating AirAsia's commitment to expansion amid high fuel prices.
- Fuel Efficiency Gains: The A220 aircraft offers enhanced fuel efficiency and lower carbon emissions, allowing profitability with fewer passengers, which enables AirAsia to tap into previously unviable smaller high-growth markets, thereby strengthening its competitive position.
- Future Growth Potential: AirAsia has the option to increase its order to 300 aircraft, covering a broader range of A220 variants, indicating its expectations for future market demand and ongoing focus on operational cost management, further solidifying its market presence in the Asia-Pacific region.
- Delivery Timeline: Deliveries are set to begin in 2028, with AirAsia planning to utilize the new aircraft to free up larger A320s and A321s for mid-haul routes, while deploying A330s for longer-haul flights to Europe, Australia, and North America, optimizing its route network.
See More
AirAsia Orders 150 A220-300s for $19 Billion
- Record Order Size: Airbus announced that AirAsia will order 150 A220-300s for $19 billion, marking the largest order for the aircraft series and pushing total orders past 1,000, reflecting strong market demand and confidence in the model.
- Positive Impact on Canada: This order not only benefits Airbus financially but also provides much-needed stability to Canada's industrial base, particularly at a time when the country faces new tariffs and historical reliance on the U.S., significantly enhancing economic resilience.
- Delivery Time Advantage: Unlike the nearly decade-long wait for A320 series deliveries, the A220's smaller order book allows AirAsia to expect deliveries as early as 2028, meeting its expansion needs and improving operational efficiency.
- Enhanced Market Competitiveness: The A220's lower fuel consumption and wider cabin space have attracted various airlines, with AirAsia planning to increase seating capacity to operate more efficiently, further solidifying its competitive position in the low-cost airline market.
See More
Citi Optimistic on Palantir Growth but Lowers Price Target
- Optimistic Growth Outlook: Citi expresses optimism regarding Palantir's growth prospects, projecting about 45% upside for FY26 and FY27 estimates, with projections for FY27 and FY28 exceeding consensus by over 500 basis points, indicating steady traction in both government and commercial sectors.
- Key Contract Wins: Palantir secured a $1 billion contract with the Department of Homeland Security and deals with the USDA, highlighting its ongoing expansion in government sectors, while renewals with Airbus and Stellantis indicate improving international momentum.
- Price Target Adjustment: Citi has lowered Palantir's price target from $260 to $210, reflecting broader valuation pressures in the software industry, yet maintains a 'Buy' rating, arguing that the company remains a clear winner as AI adoption accelerates.
- Valuation Level Analysis: Even after the price target cut, Palantir's valuation remains high, trading at approximately 48x FY27 EV to sales and about 87x EV to free cash flow, suggesting that a significant amount of optimism is already priced into the stock.
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