- Summary:
- easyJet share price has risen steadily in the last month and its baseline and fundamentals favour more gains. But its not all smooth ride.
Like I previously predicted, easyJet share price is destined for the upside in the near-term. The stock has stabilised above the GBX 500 psychological mark and its momentum indicators signal more headroom. easyJet (LSE: EZJ) traded at GBX 538, up by 1.3 percent on the daily chart at the time of writing, bringing its gains in the last five sessions to 3.4 percent.
The low-cost airliner’s pre-tax profit for the quarter ending June rose by 16% to £236 million, beating forecast estimates. Furthermore, its travel package subsidiary, easyJet Holidays, reported a 33 percent growth in customer numbers, driving its profits up by £73 million. The airline’s outlook for the full year 2024 is upbeat as it expected its passenger numbers to rise to 100 million.
With a Price-to-Sales (P/S) ratio of 0.46, easyJet share price is cheap and its healthy outlook could incentivise more inflows in the coming days. Furthermore, its fleet modernisation strategy could result is significant cost reductions in the future. However, the stock also faces a downside risk, with the Eurozone economies struggling to grow.
Meanwhile, the airline announced on Friday that it is exiting the Paris Beauvais Airport. easyJet says the airport was not a strategic development axis, aligning with its cost-cutting strategy. Nonetheless, the termination of operations at Beauvais will not result in any job losses. Furthermore, easyJet still maintains its position as the second-largest airline in France.
easyJet share price forecast
easyJet share price pivots at 538.0 and will likely continue heading up as the momentum currently favours the buyers. The first hurdle could come at 542.8, but a stronger push by the buyers will break above that level to potentially test 546.2.
On the lower side, a move below 538.0 will signal bearish control. If that happens, the first support will likely be at 534.0. However, a stronger and prolonged bearish control will breach that support and render the upside narrative invalid. Also, the resulting momentum could extend the downside to test 529.8.
