EasyJet (OTC: ESYJY) shares have weakened from $19.94 to $5 in less than several months and the current price stands around $6.29. The upcoming period will be competitive for the airline industry as air travel remains restricted due to the Covid-19 pandemic.
Fundamental analysis: The recovery will take years
EasyJet operates as an airline carrier primarily in Europe, the company has a fleet of 331 aircrafts and also engages in the trading and leasing of aircrafts. According to some reports, the global flights were down by 26% from year-prior levels and the airline industry needs support from the governments.
It seems something will get done to make sure that happens according to the UK policymakers because pandemic restrictions are cutting again the global flights. The next several months will be competitive for the airline industry and the price of EasyJet shares could weaken even more in the upcoming weeks.
EasyJet reported that Q3 global company sales were down 99% from a year ago. The negative results were impacted by the COVID-19 pandemic and the company announced that 727 of its UK-based pilots are at risk of losing the job.
Deutsche Bank explains that European travel recovery is not easy to fix and this industry is facing difficult months. EasyJet increased its revenue in 2019 to $6.15B from $6.10B in 2018 but these numbers will be difficult to achieve in the next two years.
If we compare total stockholders’ equity of $2.6B and the market capitalization of $2.77B, we can notice that this stock is not overvalued. Another useful information for potential investors is that this company has paid more than $1B dividends to its shareholders in the last four years and this number