Qantas Airways Ltd (ASX: QAN) shares have had a difficult few months.
The airline has been navigating a challenging environment, with higher operating costs and uncertainty surrounding international travel.
But with the share price coming under pressure, could October be a good time to invest?
Here's what I think.
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Why have Qantas shares fallen?
Qantas shares are trading around $8.32 on Monday, having fallen more than 20% since late June.
I think one of the biggest reasons for the weakness is the sharp increase in aviation fuel costs.
The conflict in the Middle East has pushed energy prices higher, leaving airlines facing a substantial increase in one of their largest operating expenses.
Qantas has already felt the impact. In FY26, underlying profit before tax declined to approximately $2.06 billion, with management reporting that the Middle East conflict had an estimated $420 million impact on operating earnings during the second half.
That is a significant amount of money, and it helps explain why investors have become more cautious.
Qantas has responded by increasing fares, adjusting capacity, and making changes to its international operations.
But there is a limit to how much additional cost airlines can pass on to passengers before demand starts to weaken.
With Australian households also facing higher living costs and interest rates, I think the next few months could remain challenging.
Why I still like the business
Despite these pressures, I think Qantas has some important strengths.
Its position in the Australian aviation market is particularly valuable. Through Qantas and Jetstar, the company serves different parts of the market, allowing it to cater to business travellers, holidaymakers, and more price-conscious customers.
I also like the contribution from its loyalty division. Qantas Loyalty generated underlying earnings of $625 million in FY26, demonstrating that the group's profitability extends beyond selling airline tickets.
There is also the airline's fleet renewal programme to consider.
Newer aircraft should gradually improve fuel efficiency and the customer experience, potentially helping Qantas become more competitive over time.
Of course, replacing aircraft requires substantial investment, so those benefits will take time to emerge.
Would I buy today?
I think Qantas shares are becoming increasingly interesting after their recent decline.
The business remains profitable, has strong positions in the Australian travel market, and is investing in its long-term future.
My main concern is how long elevated fuel prices could persist. If costs remain high and travellers become more cautious, the earnings recovery could take longer than investors expect.
But if fuel prices eventually moderate and travel demand remains reasonably resilient, I think Qantas could be earning considerably more in a few years.
Foolish takeaway
I would be prepared to buy Qantas shares around $8.32 with a long-term view.
I don't expect an immediate recovery, particularly given the uncertainty surrounding fuel prices.
But I think the company's market position and longer-term growth opportunities make the recent weakness worth considering.
