Jefferies initiated coverage of IAG (ICAGY) with a Buy rating and 270 GBp price target as part of a broader research note launching coverage of European Airlines. The sector does face a challenging period as carbon headwinds enter the P&L and yield expansion is uncertain, but the market fails to recognize its self-help measures and efficiency gains, the analyst tells investors in a research note. IAG also reduced costs and optimized its fleet over Covid, resulting in a high margin, multi-brand, multi-price point business, the firm added. Moreover, IAG faces low immediate carbon risk from EU ETS given exposure to non-EEA flights, Jefferies stated.