HSBC upgrades European low-cost carriers

HSBC upgraded its stance on low-cost carriers easyJet, Wizz Air and Ryanair on Friday, saying it is now more optimistic about the reopening of travel across Europe than it has been this year.

The bank lifted easyJet and Ryanair to ‘buy’ from ‘hold’, while Wizz was upgraded to ‘hold’ from ‘reduce’. The target prices were upped to 1,200p from 1,000p, €19 from €16.75 and 4,500p from 4,000p, respectively.

HSBC pointed to the fact that the EU has now agreed the Digital Covid Certificate to facilitate travel within the EU.

"The EU is also opening up to visitors from outside the EU, subject to vaccinations or testing. Whilst UK policy is not easily predicted, we expect UK travel restrictions to ease. We think the US may soon rescind its Executive Order banning UK and EU travellers entering the US.

"We see the EU moving fast to reopen the US-EU market. This could prompt the opening of the US-UK market. Once the US is defined as a green territory under the UK traffic light system, we would see pressure to open European destinations."