Could Qantas shares reach $6 in 2024?

Is the flying kangaroo going to return to form next year? Analysts believe it could.

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Qantas Airways Limited (ASX: QAN) shares have had a turbulent year.

After flying at cruising altitude for most of 2023, the airline operator's shares are now on course to record a decline of 11% for the period.

While this is disappointing, it could have created a buying opportunity for investors.

That's the view of a number of analysts who see scope for Qantas shares to ascend materially from current levels.

Could Qantas shares hit $6 in 2024?

As I mentioned above, there are a number of analysts that are bullish on Qantas shares. In fact, no less than five brokers have the equivalent of buy ratings on its shares with price targets beyond $6.

Among the most bullish brokers is Morgans, which has an add rating and a $7.30 price target on the flying kangaroo's shares. This implies potential upside of 36% for investors over the next 12 months. It commented:

QAN is trading at a material discount compared to pre-COVID multiples, despite having structurally higher earnings, a much stronger balance sheet, a better domestic market position, a higher returning International business and more diversification (stronger Loyalty/Freight earnings). The strong pent-up demand to travel post-COVID should result in a healthy demand environment for some time, underpinning further earnings growth over FY24/25.

Another bullish broker is Goldman Sachs, which has a buy rating and $8.25 price target on Qantas' shares. This suggests a potential upside of 53% from current levels.

Goldman agrees with Morgans on its valuation discount, it said:

QAN's current market capitalisation and enterprise value are 17% below and 24% below pre-COVID levels. As such, we believe QAN is not priced for a generic recovery, let alone prospects for improved earnings capacity. We continue to see upside associated with substantially improved MT earnings capacity and include QAN in our regional Conviction List.

Overall, based on what these brokers are saying, it certainly seems possible that the Qantas share price could rise to $6 or higher in 2024.

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Goldman Sachs Group. 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 Scott Phillips.

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