European Transportation Credit: 2026 Mid-Year Outlook: Smoother Sailing Meets Tighter Valuations

Research evidence excerpt

European Transportation Credit: 2026 Mid-Year Outlook: Smoother Sailing Meets Tighter Valuations

Contents and Coverage Summary

Contents and sector summary

▪European Transportation has, unsurprisingly, experienced a high degree of Airlines & Airports

volatility YTD in light of the Iran conflict and related impacts on energy IG easyJet EZJLN UW

IG Ryanair RYAID OW

costs. The recent ceasefire announcement (and drop in fuel prices) was IG IAG IAGLN N

naturally welcomed by the sector, with Transport credit having already IG Lufthansa LHAGR UW

tightened a fair way in anticipation of an agreement. While IG € XO Air France-KLM AFFP N

Transportation credit has slightly lagged the wider market YTD, we note Leisure

that many credits in the space are now trading in-line or even inside levels IG Accor ACFP N

as of late-February (pre-war), including some of the most cyclical names IG InterContinental Hotels IHGLN OW

that are still facing a higher fuel cost outlook than they were pre-war. HY Merlin Entertainments MERLLN UW

European HY Transportation meanwhile has performed broadly in-line with HY TUI AG TUIGR N

the iBoxx YTD. As such, despite the prospect of a rebound in travel TOCs/ROSCOs

bookings and relief in fuel cost outlooks prompted by the US-Iran IG Angel Trains GRSCL N

agreement, we see limited room for further spread outperformance, and we IG Eversholt EVEHOL N

rate both IG and Euro Transport UW. IG Mobico MCGLN N

IG Porterbrook PORTER OW

Shipping

Contents: IG AP Moller-Maersk MAERSK N

HY CMA CGM CMACG N ▪Middle East Developments – page 2

▪Trading Performance & RelVal – page 9 HY Hapag-Lloyd AG HPLGR UW

HY Stena AB STENA N

▪Issuance, Ratings, Capex and Consolidation – page 12 Aerospace & Defence

▪European Airlines, Airports, Aerospace – page 24 IG Airbus SE AIRFP UW