Air France-KLM

AF: XPAR (FRA)

Morningstar Rating for Stocks	Fair Value	Economic Moat	Capital Allocation
	€5.00	Tkjf	Vbxcn

Air France-KLM Makes Good Progress; Shares Cheap, but Our Very High Uncertainty Rating Is Unchanged

Joachim Kotze

Jul 29, 2022

Air France-KLM reported a very good set of results, generating EUR 386 million EBIT in the second quarter, which is a EUR 1.1 billion improvement on the prior-year comparable period and approaching precoronavirus levels. This strong performance was driven by a return to profitability for the network airlines as traffic continues to recover and the group starts reaping the benefits of cost-saving measures. We maintain our EUR 3.70 fair value estimate with shares in deep discount territory, but we still have a Morningstar Uncertainty Rating of Very High as there is still a lot of work to be done to restore the balance sheet and repay government-aided loans.

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