Highlights

  • RBC raises price target to 650p, forecasting GBP791m FY26E pre-tax profit.
  • Upgrade driven by FX tailwinds, aircraft cost efficiencies, and Holidays segment growth.
  • Shares up 0.5% to 582p following the revised outlook.

RBC Capital Markets has upgraded easyJet Plc (EZJ) to ‘outperform’ from ‘sector perform’, citing favourable macro trends and internal cost efficiency measures likely to support above-consensus profitability by FY26. The bank lifted its price target on the stock from 570p to 650p, forecasting headline pre-tax profit of GBP791 million—about 3% above the current market consensus of GBP762 million.

In its note, RBC highlighted a combination of positive external factors and internal initiatives expected to reduce seasonal losses and drive medium-term performance. These include ongoing upgauging to more efficient A320/1neo aircraft, growth in the easyJet Holidays segment, and operational efficiencies during winter periods.

RBC's data from its proprietary Elements website and Barclaycard spending trends also points to resilient UK travel demand, a key driver of expected revenue and margin improvements. The report suggests that consensus forecasts may be underestimating easyJet’s ability to deliver against its stated GBP1 billion medium-term pre-tax profit target.

The bank emphasized that its revised outlook does not assume full delivery of that GBP1 billion target, indicating that even partial progress could lead to forecast revisions by other analysts. As of 1010 BST, shares were up 0.5% to 582p, reflecting a cautious yet positive market response.

While near-term risks remain—including geopolitical uncertainty and fuel price fluctuations—RBC’s upgrade reflects an improving view of easyJet’s positioning relative to peers within the UK travel sector.