Deutsche Lufthansa AG: Execution Bar Too High

Research evidence excerpt

M

Update

August 5, 2026 04:00 AM GMT

Morgan Stanley & Co. International plc+

Deutsche Lufthansa AG | Europe

Axel Stasse

Equity Analyst

Execution Bar Too High

Nicolas J Mora

Equity Analyst

What’s Changed

Deutsche Lufthansa AG (LHAG.DE)

From

To

Price Target

€7.10

€6.50

Oscar P Smyth

Research Associate

Cedar Ekblom, CFA

2Q26 miss raises the bar for 2H26 execution. With guidance

reliant on a demanding combination of several assumptions to

align, we see further downside risk to earnings, while premium

valuation leaves little room for error. MSe FY26 EBIT €1.6bn.

New PT €6.5. UW.

Equity Analyst

Deutsche Lufthansa AG (LHAG.DE, LHA GY)

Transport | Germany

the weeks leading into results. The main debate centred on the revised FY26 EBIT

Stock Rating

Industry View

Price target

Shr price, close (Aug 4, 2026)

52-Week Range

Mkt cap, curr (mn)

Net debt (12/26e) (mn)*

EV, curr (mn)*

guidance today, with investors questioning whether the implied 2H26 fuel recapture

* = GAAP or approximated based on GAAP

rate, yield and LF improvement are achievable. Management reiterated that demand

Fiscal Year Ending

12/25 12/26e 12/27e 12/28e

remains resilient despite increasing ME capacity, although investors remain

Sales / Revenue

(€mn)**

EBITDA (€mn)**

EBIT (€mn)**

EPS (€)**

Prior EPS (€)**

ModelWare EPS (€)

EPS (€)§

P/E**

DPS (€)

Div yld (%)

FCF yld ratio (%)**

Net debt (€mn)*

Net debt/EBITDA**

RNOA (%)**

ROE (%)**

39,597 42,824 44,835 46,424

Key debates on earnings day: Lufthansa shares underperformed following its 2Q26

miss, with investors having anticipated a beat after expectations were reset lower in

concerned about potential booking softness and LHA's yield-focused strategy

limiting competitiveness. The implied 2H26 RASK required of 4% to 8% also appears

demanding vs peers guiding closer to ~MSD%, while the outlook excludes any

potential strike disruption, and delayed aircraft deliveries might prevent from

delivering better-than-expected unit costs. Overall, our sense is investors remain

cautious, believing that delivering even the lower end of guidance would require

several key assumptions to fall into place simultaneously.

…