Qantas Airways Ltd (ASX: QAN) shares ended the day 1.75% higher on Wednesday, at $10.48 a piece.
So far in 2026, the shares have climbed 0.67%. They're currently trading 12.81% higher than this time last year.
For context, the S&P/ASX 200 Index (ASX: XJO) closed 0.15% higher on Wednesday, is down 0.06% for 2026 so far, and 4.95% higher than this time last year.
The aviation heavyweight has dominated the Australian domestic aviation market for decades alongside rival Virgin Australia. Qantas' share of the domestic market currently accounts for around 60%, and it's still growing.
Qantas is adding capacity to its routes to mainland US, New Zealand, Singapore, and Hawaii. Meanwhile its subsidiary, Jetstar, is adding capacity to its routes to Bali, New Zealand, Thailand, South Korea, and Singapore and executed its first flight direct to the Philippines in late-November.
Qantas is also planning to scale AI usage across the business over the coming year, according to The Australian. The airline company's CEO said the business is laying the foundations for increased use of AI, and said that he thinks Australia needs to move quickly on the "unprecedented" opportunities it represents.
Just last month the airline appointed its first chief technology, AI and transformation officer, Rachel Yangoyan.
Are the shares a buy, hold or sell for 2026?
While I'm a little concerned about the concentration of Australia's domestic aviation market, and that the airline has its work cut out to be able to achieve the rate of growth it expects in 2026, analysts are pretty bullish on the outlook for Qantas shares.
TradingView data shows that 11 out of 13 analysts have a buy or strong buy rating on the shares.
At the time of writing the maximum 12-month target price on the shares is $13.17 each, which implies a 26.62% upside for investors, at the time of writing.
UBS has a buy rating on the business, with a price target of $11.50.
Macquarie also thinks there's still plenty more upside to come. The broker recently upgraded Qantas shares to an outperform rating with a $12.29 price target. This implies a potential upside of 17.27% for investors at the time of writing.
The broker said that Jetstar continues to be the growth driver, both domestically and internationally. It added that the outlook for the company is favourable, with strong low cost carrier growth and lower oil prices mitigating potential load factor pressure.
