Air transportation: Ready for takeoff: Hiking our ratings on Japan Airlines and ANA Holdings to Buy

Research evidence excerpt

Air transportation: Ready for takeoff: Hiking our ratings on Japan Airlines and ANA Holdings to Buy

Global Markets Research

Air transportation 1 July 2026

EQUITY: JAPAN TRANSPORTATION

Ready for takeoff: Hiking our ratings on Japan Airlines and Research Analysts

ANA Holdings to Buy Japan transportation

Masaharu Hirokane - NSC

Fuel prices settling; entering phase where focus should turn to 28/3 masaharu.hirokane@nomura.com

earnings, structural improvement in margins on domestic routes +81 3 6703 1142

We raise our ratings on Japan Airlines and ANA Holdings to Buy for four key

reasons

We have raised our ratings on Japan Airlines [9201] and ANA Holdings [9202] to Buy (see

individual company reports for our detailed forecasts). This is because: (1) fuel prices are

trending downward with countries diversifying their fuel procurement sources and the US and

Iran having signed a memorandum of understanding (MOU) that sets the stage for a permanent

ceasefire; (2) both companies plan to introduce fuel surcharges on domestic routes in 28/3,

structurally reducing the risk of earnings deterioration from a weak yen and high fuel costs; (3)

margins look likely to improve from 28/3 thanks to a reduction in flights on unprofitable

domestic routes made possible by government-led measures to ease competition; and (4) we

expect the number of passengers on international routes to continue growing alongside

ongoing fare increases, driven by an influx of inbound travelers with strong buying power and

increased business travel supported by robust Japanese corporate earnings.

Our new target prices are ¥3,700 for Japan Airlines and ¥4,000 for ANA Holdings. We obtain

our target prices by multiplying our 28/3 EPS forecasts by a P/E of around 13x, a discount of