Key Takeaways
- Jet2’s profits warning comes after a travel boom for European airlines
- IAG and Ryanair are the standout performers so far this year in share price terms.
- EasyJet shares are undervalued according to Morningstar.
Shares in UK-listed airlines fell on Sept. 4 after a profit warning grounded the shares of Jet2 JET2, a package holiday company that said summer sales had come in below forecasts and that customer booking trends were getting harder to forecast. This drop in the sector’s share price comes in the context of an ongoing travel boom that has benefited European airlines and pushed up share prices.
Budget airlines stocks easyJet EZJ, Wizz Air WIZZ, and Ryanair RYA saw the biggest losses, while shares on British Airways and Iberia owner International Consolidated Airlines Group IAG fell modestly.
How Airline Stocks Are Performing in 2025
EasyJet’s share price fall this week continues a weaker trend in 2025, while shares in rivals Ryanair and IAG are up significantly this year.
These changes compare with a Morningstar Global Airlines Index gain of nearly 10% in dollar terms in 2025, or 2% in GBP because of the sharp appreciation in sterling.
Are easyJet Shares a Buy, Sell, or Hold?
After today’s moves and the trends of 2025, are any listed airline stocks now attractively valued?
EasyJet is the only undervalued airline stock covered by Morningstar, trading in 4 star-territory. Its shares now trade at a 27% discount to its fair value estimate of 640p. The company posted a £44 million profit before tax in the first half of the year, up 42% year over year.
According to Loredana Muharremi, equity analyst at Morningstar, the group has embarked on a long-overdue cost-restructuring program and fleet modernization, which could see it emerge as a more efficient industry player.
EasyJet is also benefiting from consolidating its position in high-return airports in Italy, while it’s primed to take advantage of business travel downgrading to low-cost alternatives, she says.
