Goldman Sachs Adds Qantas Airways Limited (ASX: QAN) Shares to Asia-Pacific Conviction List
Are you looking for a promising investment opportunity in the Asia-Pacific region? Look no further than Qantas Airways Limited (ASX: QAN) shares, which have recently caught the attention of analysts at Goldman Sachs. In fact, they have just added Qantas shares to their highly coveted Asia-Pacific conviction list, alongside only three other ASX shares.
So, what is it about Qantas that has sparked such bullish sentiment from Goldman Sachs? According to analyst Niraj Shah, the airline operator is poised for sustainably improved earnings capacity relative to pre-COVID levels. This potential for growth is not currently reflected in Qantas’ valuation, with the stock trading at a discount compared to its regional and US peers.
Goldman’s analyst believes that earnings in FY 2024 will be significantly higher than pre-COVID levels and, importantly, sustainable at these new heights. With capacity expected to reach around 95% of pre-COVID levels in FY24, Qantas is forecasted to see a substantial increase in earnings per share, driven by cost-cutting measures implemented during the pandemic.
In light of these positive projections, Goldman has assigned a conviction buy rating and a $8.05 price target on Qantas shares. This represents a potential upside of 32% for investors over the next 12 months. Additionally, with a forecasted dividend yield of 4.9% in FY 2025, shareholders could also benefit from some dividend income.
Overall, Qantas shares are in a prime position for growth and could be an attractive option for investors looking to capitalize on the recovery of the airline industry. With Goldman Sachs backing the stock and a promising outlook ahead, now might be the perfect time to consider adding Qantas shares to your investment portfolio.
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