The Qantas (ASX:QAN) share price fell 6% last time the company reported

What happened to the airline's shares during H1 FY21?

| More on:
Travel bags sit by an airport lounge window overlooking a grounded plane on the tarmac

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The Qantas Airways Ltd (ASX: QAN) share price is relatively flat since the beginning of 2021. The airline operator continues to battle COVID-19 which has severely affected its operations and the wider travel market.

At Tuesday's market close, Qantas shares finished the day up 5.48% to $4.62.

What happened to Qantas shares last earnings season?

When Qantas reported its half-year scorecard for FY21, its shares tanked 6% within a matter of days. This was short-lived however, with the company's share price rebounding to touch a 52-week high of $5.79 the following month.

Looking back at the results, Qantas delivered revenue of $2.33 billion, a mammoth 75% drop compared to the prior corresponding period. The stark fall came predominately from Victoria's extended lockdown and nationwide border closures.

However, the company achieved underlying earnings, before, interest, tax, depreciation and amortisation (EBITDA) of $86 million. Management noted that this reflected the fundamental resilience of Qantas' portfolio.

Nonetheless, the group posted an underlying loss before tax of $1.03 billion. This compares to a net profit before tax of $771 million in H1 FY20.

Qantas Group CEO Alan Joyce commented at the time:

These figures are stark but not surprising.

Despite the huge challenges, these results show the group's underlying strength.

Our priorities remain the safety of everyone who travels with us, getting as many of our people back to work as possible and generating positive cash flow to repair our balance sheet.

Is the Qantas share price a buy?

A recent report released by Goldman Sachs slapped a buy rating on Qantas shares, indicating a 12-month price target of $6.38.

While this represents an upside of 38% based on the current Qantas share price, the broker noted some downside risks. They included rising competition, poor passenger volumes, higher fuel prices, loss of cost benefits, delayed border openings, and slower demand recovery.

Qantas has a market capitalisation of roughly $8.7 billion, with more than 1.8 billion shares on its registry.

Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Travel Shares

Bored woman waiting for her flight at the airport.
Travel Shares

Why is the Flight Centre share price falling today?

What's going on with this travel agent's shares?

Read more »

Man sitting in a plane seat works on his laptop.
Travel Shares

A 'once in a lifetime' opportunity for Qantas shares?

Can this stock fly higher?

Read more »

Two elderly men laugh together as they take a selfie with a mobile phone with a city scape in the background.
Travel Shares

Act fast if you want to receive the next Flight Centre dividend

It won't be long until this travel agent pays its next dividend.

Read more »

Man sitting in a plane looking through a window and working on a laptop.
Travel Shares

Why is the Webjet share price racing to a 52-week high today?

Webjet has been busy talking up its WebBeds business this morning.

Read more »

A businessman points a finger in accusation, indicating a share price or ASX company in trouble
Travel Shares

Qantas shares hit turbulence amid $250,000 fine for 'shameful' conduct

ASX 200 investors are bidding down the Qantas share price on Wednesday.

Read more »

A woman ponders a question as she puts money into a piggy bank with a model plane and suitcase nearby.
Travel Shares

Flight Centre shares plunge 7% despite return of the interim dividend

ASX 200 investors are sending the Flight Centre share price spiralling lower on Wednesday.

Read more »

Happy couple looking at a phone and waiting for their flight at an airport.
Earnings Results

Flight Centre share price on watch amid 565% half-year profit surge

Flight Centre shares could see some sizeable moves today after the ASX 200 travel stock reported on its half-year results.

Read more »

Two elderly men laugh together as they take a selfie with a mobile phone with a city scape in the background.
Travel Shares

Own Flight Centre shares? Here's what you need to know ahead of its results

The travel agent giant is releasing its results on Wednesday next week.

Read more »