Morgan Stanley has initiated coverage on Air France-KLM (AFLYY) with an “Equal Weight” rating, setting a price target of EUR 11.30. The brokerage noted that while the airline’s restructuring progress remains commendable, it is offset by financial and execution risks that could weigh on future performance.
According to Morgan Stanley, Air France-KLM’s ongoing efforts to strengthen its balance sheet and streamline operations have yielded tangible improvements. However, the firm cautioned that macroeconomic uncertainties, competitive pricing pressures, and potential cost escalations may constrain profitability in the near term.
The brokerage’s initiation comes as part of a broader coverage on European airlines, where International Consolidated Airlines Group (IAG) and Ryanair were rated “Overweight”, while Lufthansa and EasyJet were rated “Underweight.”
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