Airbus stock target raised at Barclays on solid 2024 deliveries

Investing.com -- Shares of Airbus (EPA:AIR ) traded higher on Friday after Barclays (LON:BARC ) raised the target price of its stock to €200 from €166 reflecting confidence in the company’s strong delivery outlook for 2024. 

Analysts at Barclays cited better-than-expected aircraft deliveries for the year as a key factor behind this upward revision.

The commercial aircraft manufacturer successfully delivered 766 commercial aircraft in 2024, surpassing initial projections. 

This achievement sets a robust foundation for 2025, with deliveries forecasted to reach 832 units, marking a 9% year-on-year increase. 

Barclays analysts said that the delivery growth is underpinned by rising output of the A320 family, particularly models powered by the LEAP engine, which has seen improvements in turbine hardware durability. 

Additionally, production efficiency in wide-body aircraft, such as the A350, continues to bolster Airbus' performance despite capacity constraints flagged by the company.

The bank’s optimism extends into the long-term outlook. Barclays expects deliveries to rise to 915 units by 2026 and 1,005 units by 2027, driven by both demand for single-aisle jets and advancements in production. 

This trajectory is expected to deliver a 40% growth in adjusted EBIT from 2025 to 2027, underscoring the financial momentum supporting Airbus' valuation.

The stock’s new price target reflects a revaluation based on projected 2027 metrics, with Barclays analysts emphasizing the opportunity for substantial returns as delivery numbers climb. 

Despite risks inherent in the aerospace industry, such as supply chain challenges and fleet management complexities, the company’s balance sheet strength and competitive position, particularly against Boeing’s MAX series, have reinforced investor confidence.

Source: Investing.com