Lufthansa initiated with a Hold at Jefferies

Jefferies analyst Jaina Mistry initiated coverage of Lufthansa (DLAKY) with a Hold rating and EUR 6.40 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. Lufthansa has the oldest fleet in the firm’s coverage as well as the lowest margins however, and while fleet delivery should ultimately drive margin recovery, the airline’s exposure to Boeing (BA) could delay progress, the firm added.