It was a top month for ASX shares and the S&P/ASX 200 Index (ASX: XJO) over July. The ASX 200 banked a healthy 2.9% over the month just gone, rising from 7,203.3 points to 7,410.4 points the index closed at yesterday. But let's talk about the Qantas Airways Limited (ASX: QAN) share price.
If you think the ASX 200 had a good month last month, wait until you hear about Qantas shares. This ASX 200 travel stock started July out at $6.20 a share. But yesterday, the Qantas share price closed at $6.58. That's a gain of 5.32% for Qantas over July – a return nearly double that of the broader market:
So what went so right for the national carrier last month?
Why did the Qantas share price nearly double the ASX 200 in July?
Well, it's hard to say, really. There was almost no news or announcements out of Qantas itself at all over July, save for some routine ASX paperwork out at the start of the month.
What we do know, though, is that the Qantas share price was a major beneficiary from some ASX broker love over July.
Earlier last month, we covered ASX broker Morgans and its add rating for Qantas shares. Morgans gave the airline a 12-month share price target of $8.50, which is a good 31.6% above where the shares stand today.
Calling Qantas one of its "best ideas", Morgans noted that despite a strong balance sheet, higher warnings and rising market share, "QAN is trading at a material discount compared to pre-COVID multiples".
Later in the month, we also looked at the views of fellow ASX broker Goldman Sachs. Goldman is equally bullish on the Qantas share price, giving the company a 'conviction buy' rating and sharing Morgans' share price target of $8.50.
Goldman also views Qantas as undervalued, and stated that "we believe QAN is not priced for a generic recovery, let alone prospects for improved earnings capacity".
So it's entirely possible that Qantas' good fortunes over July grew out of these decisively positive ratings from two prominent ASX brokers. No doubt investors will be hoping that August proves just as fruitful. But we'll have to wait and see.
As it stands today, the Qantas share price is up 7.66% year to date and a whopping 37.9% over the past 12 months.
