The Qantas Airways Limited (ASX: QAN) share price was on form in November.
During the course of the month, the airline operator's shares ascended by 8.5% to end the month at $8.77.
At one stage, the company's shares were trading at a record high of $9.05.
This latest monthly gain means that the Flying Kangaroo's shares are now up over 60% since the start of the year.
This is quite a turnaround for Qantas given how its shares had sunk to a 52-week low in March.
Why did the Qantas share price race higher in November?
Interestingly, last month's gain was achieved despite there being no news out of the company during the period.
Though, it is worth noting that there was a bullish broker note out of Morgan Stanley in the middle of the month which wouldn't have done it any harm at all.
According to the note, the broker has put an overweight rating and $10.50 price target on its shares. Based on the current Qantas share price of $8.77, this implies further potential upside of 20% for investors over the next 12 months. Clearly, Morgan Stanley doesn't believe it is too late to get in on the action!
In addition, the broker is forecasting a 27 cents per share dividend in FY 2025. This represents a 3.1% dividend yield, which stretches the total potential return to approximately 23%.
Not bad given how much it has rallied in 2024!
Why is it bullish?
The note reveals that Morgan Stanley believes that Qantas stands to benefit greatly from lower fuel prices. Especially given that customer demand remains strong.
As we covered here, the broker said:
Demand remains robust and fuel has shifted to become a tailwind. Going forward, favourable market dynamics and returns on capital expenditure provide confidence and point to upside risk.
And despite its shares being at record levels, the broker expects Qantas to announce another sizeable share buyback in FY 2025. This should be supportive of its share price.
Morgan Stanley also believes that the aforementioned forecast for a 27 cents per share dividend in FY 2025 could be a key driver of share price gains. It adds:
We see this as an important milestone with the opening of the door to income-focused investors and a likely increased attractiveness for retail investors.
All in all, things are certainly looking up for Australia's flag carrier airline and it isn't overly surprising to have seen its shares rally strongly again in November.
