Qantas Airways Limited (ASX: QAN) stock was a strong outperformer in 2022.
Over the 12 months the S&P/ASX 200 Index (ASX: XJO) listed airline's share gained 20%. And that came during a year when the ASX 200 itself lost 5%.
Dividend payouts remained off the table in 2022, however. Those were suspended in early 2020 as Qantas stock was ravaged by the fallouts from the global pandemic lockdowns, which saw air travel virtually eliminated.
Still, you're unlikely to hear any investors complaining about a 20% annual share price gain.
The question for ASX 200 investors now is, will Qantas stock be a good investment in 2023 as well?
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What's the outlook for Qantas stock in 2023?
According to analysts at Morgans, Qantas stock could be in for some more significant outperformance in the year ahead.
In early December the broker initiated coverage on Qantas shares with an add rating and an $8.50 price target. Morgans is optimistic over the airline's upgraded earnings expectations, released on 23 November. Its analysts also cited the positive tailwinds from continued pent-up travel demand as borders broadly reopen.
Another broker with a positive outlook for Qantas stock in 2023 is UBS. Its analysts have a buy rating on the airline with a price target of $7.60. The broker noted that shares are still trading at a considerably lower level than they were in the months before the pandemic.
Now over the past few weeks, the great China reopening has hit some snags. With COVID spreading rapidly through the population, this has seen many nations, Australia included, reintroduce mandatory virus testing for Chinese travellers.
How this plays out remains to be seen. If the virus continues to hamper travel into and out of the world's most populous nation it could throw up some unwanted headwinds for Qantas stock.
Safest airline in the world
Qantas stockholders will be pleased to know that the airline has regained its safest in the world credentials. Qantas was awarded the world's safest airline for 2023 by AirlineRatings.com.
"Our Top Twenty Safest Airlines are all standouts in the industry and are at the forefront of safety, innovation, and launching of new aircraft," said AirlineRatings.com Editor-in-Chief Geoffrey Thomas.
How has Qantas stock been tracking?
After gaining 20% last year, as you can see below, Qantas stock remains down 16% from its January 2020 levels, before most of the world had heard of the coronavirus.
But if UBS and Morgans have it right, the airline could retest and indeed exceed those levels in 2023.
