Will Ryanair shares keep rising after pay deals save jobs at airline?
The low-cost airline's shares are up 8% in August, with the stock making gains on Friday after it announced it will cut far fewer jobs than the 3000 it originally expected due to the majority of staff accepting pay cuts.
Ryanair shares close 2% higher on Friday after the company announced it will cut far fewer jobs than the 3000 it originally expected to due to the majority of staff accepting pay cuts.
The low-cost airline saw 97% of pilots and 90% of cabin crew agree to the pay cuts and amendments to their working schedule, with the company forced to adjust to a 20% reduction in flight capacity as a result of Covid-19, which also grounded its aircraft throughout Q2 2020.
‘We haven’t finalised the number yet, we originally said there was going to be 3000 redundancies but we have been able to reduce that significantly,’ Neal McMahon told Reuters in a telephone interview.
Ryanair urges Irish government to add Portugal to ‘green list’
The low-cost airline has pleaded with the Irish government to add Portugal to its ‘green list’, contending that the risk of infection is far smaller in the Algarve than in Ireland.
Ryanair has criticised the government’s travel restrictions - some of the strictest in Europe – which require travellers from most EU states to self-isolate for 14 days after arriving.
‘Proper testing at airports, and effective tracing (as is being conducted in Germany and Italy) is the only realistic and proportionate method of supervising safe intra-EU air travel while effectively limiting the spread of the Covid-19 virus,’ a spokesperson for Ryanair said.
Analysts believe Ryanair shares will bounce
The average price target for Ryanair is €13.39 per share, implying a potential upside of 17%.
The stock is up 8% in August despite being weighed down by concerns about coronavirus and travel restrictions imposed on various internationally and across Europe.
European governments travel restrictions have dried up flight demand to countries subjected to 14-day self-isolation protocols, applying intense pressure on airlines and the wider travel industry.
Ryanair closed at €11.39 per share on Friday, with the stock down 23% year-to-date.
Ryanair cancels flights after fresh quarantine restrictions
The low-cost airline told investors this week that is will reduce its flight capacity by 20% throughout September and October after passenger bookings suffered a significant hit as a result of Covid-19 related travel restrictions.
Ryanair admitted that the largest cuts to its flight schedule will be on routes to France, Spain, Sweden and Ireland.
Ryanair accused Ireland of having the most restrictive quarantine rules and urged the country to amend its ‘green list’ of safe countries. But with new coronavirus cases emerging throughout Europe things are likely to get a lot worse for Ryanair and its peers.
‘These capacity cuts and frequency reductions for the months of Sept & Oct are necessary given the recent weakness in forward bookings due to Covid restrictions in a number of EU countries,’ a Ryanir spokesperson added.
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