EasyJet successfully issues new EUR500m bond

Low-cost airline easyJet said on Wednesday that it has priced the issue of €500m bonds maturing in October 2023 at a coupon of 1.125%.

Chief financial officer Andrew Findlay said: "The successful placing of this bond shows the market's belief in easyJet's balance sheet and its confidence in the strength of our strategy of long term profitable growth."

Brokerage Cantor Fitzgerald said the bond was priced at an attractive low coupon rate, which “suggests market confidence in its budget airline business model and balance sheet”.

Cantor pointed out the stock has been weak, underperforming the European airlines sector in the past quarter and now providing good value as it trades on calendar 2017 price-to-earnings of 9x.

This is a 30% discount to the stock’s long-run average PE.

“We noted that consensus forecasts for this year (FY17) have fallen sharply and now suggest no growth year-on-year. If FY17 proves to be less turbulent there could be good upside to consensus,” said Cantor, as it reiterated its ‘buy’ rating and 1,300p price target on the stock.

At 1425 BST, easyJet shares were up 1.2% to 911.50p.