Broker snap: AlphaValue downgrades IAG

6th Jul 2011 10:26

Analysts at AlphaValue downgraded IAG from overweight to underweight with a price target of €3, following the release of the airline's June passenger statistics.IAG saw a 2.3% annual increase in its passenger load factor in June to 81.7%. Also, traffic measured in revenue passenger kilometres rose 9.2%."Figures are compared to a 2010 basis which was affected by disruption at British Airways related to 14 days of strikes by cabin crews. IAG did not give restated growth rates but mentioned that the underlying revenue trend was in line with last month. The North America, Latin America & Caribbean and Asia/Pacific networks were buoyant with passenger traffic increases of 23.4%, 15.2% and 18.9% respectively," AlphaValue explained.AlphaValue also acknowledged that "traffic growth was lower but satisfactory in the European and Africa/Middle East networks (+5.2% and +9.7% respectively)". Domestic flights suffered from a drop in passenger traffic but was compensated by improvement in Europe.Shares of IAG are now down 2.05%.S.B.