Jet2 PLC (JET2) AI Stock Analysis

• Market Cap: $2.86B
• Dividend Yield: 1.07%
• Average Volume (3M): 698.89K
• Price to Earnings (P/E): 5.7
• Beta (1Y): 0.87
• Revenue Growth: 18.05%
• EPS Growth: 16.71%
• Country: UK
• Employees: 14,053
• Sector: Consumer Cyclical
• Sector Strength: 53
• Industry: Hotels, Lodging & Leisure
• EPS (TTM): 2.34
• Shares Outstanding: 214,683,850
• 10 Day Avg. Volume: 1,046,136
• 30 Day Avg. Volume: 698,895
• PEG Ratio: 0.34
• Price to Book (P/B): N/A
• Price to Sales (P/S): 0.43
• Price to Cash Flow (P/CF): 1.70
• P/FCF Ratio: 2.20
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: 2,005.16p
• Price Target Upside: 50.65% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 6

Jet2 PLC demonstrates strong financial performance with solid revenue growth and profitability. The stock's technical indicators point to a potential short-term rebound, but current bearish trends suggest caution. Valuation metrics indicate the stock is undervalued, and corporate strategies are promising despite initial challenges with new expansions. Overall, Jet2's robust financial health and strategic initiatives make it a compelling investment, provided short-term market conditions are navigated carefully.

Positive Factors

Financial Performance

Jet2 saw a strong H1 with a 4% PBT beat vs our estimate and 7% on EPS.

Market Share

Early S25 trading looks encouraging with market share gains.

Negative Factors

Operating Expenses

The updated FY25/26E PBT sits below consensus and factors in higher FY26E operating expenses inflation.

Jet2 PLC Business Overview & Revenue Model

Company Description

Dart Group plc engages in the provision of aviation and distribution services. It operates through the Leisure Travel; and Distribution and Logistics segments. The Leisure Travel segment provides scheduled holiday flights by its airline, Jet2.com, and ATOL licensed package holidays by its tour operator, Jet2holidays, to leisure destinations in the Mediterranean, the Canary Islands and to European leisure cities. The Distribution and Logistics segment focuses in the evaluation of distribution centre-level performance data. The company was founded was founded by Philip Hugh Meeson in 1980 and is headquartered in Leeds, the United Kingdom.

How the Company Makes Money

Jet2 PLC generates revenue primarily through its integrated model of holiday packages and airline services. The company makes money by selling holiday packages through Jet2holidays, which include flights, accommodation, and other travel-related services. Revenue is also derived from ticket sales via Jet2.com, which operates as a low-cost airline. Additional income streams include ancillary services such as in-flight sales, seat selection fees, and travel insurance. Partnerships with hotels and other travel service providers play a significant role in its business model by ensuring competitive pricing and exclusive offers for customers, thus enhancing its package holiday offerings.

Jet2 PLC Financial Statement Overview

Summary

Jet2 PLC exhibits a robust financial trajectory with significant improvements in revenue, profitability, and return on equity. The company has effectively leveraged its equity base to enhance profitability, though high liabilities necessitate careful management. Strong operational cash flows provide a solid foundation for ongoing financial health, positioning Jet2 well in the competitive hotels, lodging, and leisure industry. Continued focus on optimizing leverage and managing capital expenditures could further strengthen its financial standing.

Income Statement

Jet2 PLC has demonstrated robust revenue growth, showing a remarkable recovery with a consistent increase in total revenue over the past few years. The gross profit margin improved to 13.45% from a negative figure in 2022, indicating enhanced operational efficiency. Net profit margin stands at 6.38%, reflecting profitability improvements. Additionally, the EBIT and EBITDA margins are healthy at 6.84% and 13.57%, respectively, suggesting strong operational performance. However, maintaining these levels in a competitive industry remains a challenge.

Balance Sheet

The company's balance sheet shows a solid equity position with an equity ratio of 25.29%, indicating a stable financial structure. The debt-to-equity ratio is 1.03, reflecting manageable leverage. The return on equity has significantly improved to 28.32%, showcasing effective use of shareholders' funds to generate profits. However, the overall liabilities are relatively high, which could pose risks if not managed efficiently.

Cash Flow

Jet2 PLC's cash flow statement presents a strong operating cash flow to net income ratio of 2.74, indicating efficient cash generation from operations. The free cash flow to net income ratio is 1.72, demonstrating robust cash flow relative to earnings, supporting future investments and debt obligations. However, the free cash flow growth rate is slightly negative, suggesting the need for improved capital expenditure management.

Breakdown
Mar 2024	Mar 2023	Mar 2022	Mar 2021	Mar 2020
Income Statement		Total Revenue
6.26B	5.03B	1.23B	395.40M	3.58B
	Gross Profit
841.20M	707.70M	-147.90M	-264.90M	503.30M
	EBIT
428.20M	394.00M	-323.90M	-336.10M	293.00M
	EBITDA
849.20M	579.20M	-172.00M	-165.70M	427.20M
	Net Income Common Stockholders
399.20M	290.80M	-315.40M	-271.20M	116.00M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
3.18B	2.62B	2.23B	1.38B	1.39B
	Total Assets
5.57B	4.53B	3.99B	2.87B	3.38B
	Total Debt
1.46B	1.38B	1.57B	1.32B	1.16B
	Net Debt
15.80M	-1.25B	522.70M	-60.70M	-229.10M
	Total Liabilities
4.16B	3.51B	3.10B	1.91B	2.75B
	Stockholders Equity
1.41B	1.01B	896.60M	964.20M	634.10M
Cash Flow		Free Cash Flow
685.50M	755.50M	642.60M	-872.20M	205.00M
	Operating Cash Flow
1.09B	952.10M	751.00M	-834.80M	443.10M
	Investing Cash Flow
-482.30M	-675.80M	-1.29B	41.10M	-185.60M
	Financing Cash Flow
-124.60M	-370.30M	201.00M	797.40M	-88.10M

Jet2 PLC Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 1331.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:JET2, the sentiment is Negative. The current price of 1331 is below the 20-day moving average (MA) of 1459.10, below the 50-day MA of 1485.70, and below the 200-day MA of 1428.88, indicating a bearish trend. The MACD of -38.73 indicates Positive momentum. The RSI at 33.10 is Neutral, neither overbought nor oversold. The STOCH value of 28.28 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for GB:JET2.

Jet2 PLC Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
JET2	75 Outperform	$2.86B	5.68	28.33%	1.07%	18.05%	16.71%
WIZZ	63 Neutral	£1.50B	6.01	205.34%	―	5.20%	13.48%
Sector *	60 Neutral	$13.01B	10.45	0.79%	3.53%	1.60%	-22.47%

Jet2 PLC Corporate Events

Jet2 PLC Announces Change in Voting Rights Ownership

Jet2 PLC, a UK-based company, has announced a change in the ownership of its voting rights. Computershare Trustees (Jersey) Limited has increased its holding from 3.1857% to 4.0783% of the total voting rights in Jet2 PLC. This development reflects a shift in shareholder dynamics, which could influence the company’s future decision-making and governance structure.

Jet2 plc Projects Increased Profit Amid Expansion and Economic Challenges

Jet2 plc reports an anticipated profit growth of 8% to 10% for the financial year ending March 2025, despite a decrease in average load factor and competitive pricing pressures. The company has expanded its seat capacity for both winter 2024/25 and summer 2025, with new bases at Bournemouth and London Luton contributing to this growth. However, these new bases are expected to be modestly loss-making initially due to their late introduction. Inflationary pressures and additional costs from government regulations pose challenges, but strategic investments in new aircraft and cost hedging are helping to mitigate these issues. Jet2 is focused on maintaining its Customer First proposition, even as macroeconomic conditions may pressure profit margins. The company remains confident in its ability to attract customers due to its trusted brand and comprehensive holiday offerings.

Jet2 plc Strengthens Position with Bond Repurchase

Jet2 plc has repurchased an additional £33 million of its £337.4 million convertible bonds due in 2026, at a total consideration of £34.5 million. This move reduces the outstanding bond principal to £304.4 million, potentially strengthening Jet2’s financial position and reflecting strategic financial management.