Broker snap: easyJet a 'buy' after in-line full year, says Nomura

20th Nov 2012 09:51

Nomura has reiterated its 'buy' rating and 650p target price for budget airline easyJet after the firm met expectations with its full-year figures on Tuesday.Profit before tax (PBT) for the year to September 30th came in at £317m, slightly above Nomura's £315m estimate and towards to top-end of previous guidance of £310-320m.Full-year revenue per seat growth was 5.9%, below the broker's 6.5% forecasts, but this was heavily distorted by currency, analysts said. Excluding currency, growth was more or less in line with the third quarter at 7.5%.Meanwhile, Nomura said: "With the strong cash flow and liquidity levels above plan (£4m per aircraft), easyJet has decided to increase the dividend payout from 20% to 33%. This reflects the confidence in returns."However, the broker notes that easyJet's outlook continues to reflect headwinds at this early stage, such as fuel, currency movements and airport costs.Nomura said that given these headwinds, it maintains its current-year PBT estimate of £325m."We recognise potential upside could come from allocated seating, yield management improvements and ongoing network developments," the broker said.easyJet's shares were up 5.90% at 691p in mid-morning trade.Bc