Deutsche Bank downgraded Jet2 (AIM:JET2) to Hold from Buy, and cut its price target to 1,086p from 1,457p, amid softening demand since the start of the Iran conflict.
Analyst Richard Stuber noted booked passenger levels are now +6.2% year-to-date versus +7.9% pre-conflict, while the group is expanding capacity by 7.7% year-on-year, including the new London Gatwick base, and management's drive to "invest in load factor" implies pressure on yields, particularly seat-only fares.
The German bank pointed out that Jet2 is c.87% hedged for summer fuel but says an anticipated c.10% FY27 fuel tailwind has been reversed, and the analysts trimmed forecasts accordingly as it pared down valuation upside.
Deutsche Bank flags Jet2's Preliminary Results on 8 July as the next hard catalyst for confirmation of full-year numbers, FY27 capacity guidance and the early-booking trend.
