Ryanair: Best Idea Q3 2026 - Fuel crisis easing, shares discounting too-low unit economics

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Ryanair: Best Idea Q3 2026 - Fuel crisis easing, shares discounting too-low unit economics

ord of solid management. For investors that want some exposure to European airlines but are fearful of the risks in this price-

elastic, capital-intensive, commodity price-exposed industry, Ryanair is a good choice.

... and counter-cyclical investment in every downturn. Ryanair is relentlessly opportunistic. It has a long track record of

counter-cyclical investment, snapping up aircraft at bargain prices when OEMs are desperate for orders, and pushing capacity

into markets where competitors are weakening to capture new traffic. Again and again, Ryanair has used its financial strength in

periods of industry turmoil to enhance its competitive standing.

RISKS

As an airline, Ryanair remains exposed to oil prices and the broader macroeconomic environment. The beauty of aviation is that

everything is connected: geopolitics, GDP growth, inflation and fuel prices all ultimately feed through to airline earnings. The

key near-term risk is soft pricing into summer, where capacity growth looks to be 6-7%, and the industry continues to face cost

inflation across maintenance, airport charges, ESG-related costs and labor. This is particularly prevalent in certain markets: UK

leisure outbound is seeing unusually high growth from a Jet2 that has been “investing in load factor” (i.e. discounting), while

a return to stronger growth from Wizz Air in Central and Eastern Europe could also increase competitive pressure in one of

Ryanair's core regions.

TIMING

Ryanair has been the worst-performing major European airline stock in 2026, down 7%, while LCC peers are broadly flat

and legacy carriers are up by mid-teens percentages. We see the discrepancy as unjustified, and in our view this creates an