Bernstein has upgraded Ryanair (RYA) to "outperform" from "market-perform," while downgrading easyJet and Wizz Air to "market-perform," according to an Investing.com report. The moves stem from a roughly $200 per metric ton increase in the European jet fuel forward curve, triggered by Middle East tensions involving Iran.

Jet fuel spot prices have nearly doubled this year amid the conflict, with the crack spread climbing from $25 to over $100 per barrel. September 2026 forwards now stand about $500/MT above year-ago levels. Bernstein notes Brent crude has reached $95-100/bbl since the Strait of Hormuz disruptions, affecting global oil flows.

This shift has "fundamentally altered" earnings outlooks for European carriers, analysts stated.

Ryanair benefits from a net cash position exceeding €1 billion, 80% fuel hedge coverage for fiscal 2027, and mid-teens EBIT margins—the highest among point-to-point peers. Despite slashing FY27 EPS estimates by 20% and FY28 by 16%, Bernstein raised its FY29 EV/EBIT multiple to 10.9x and lifted the target price 14% to €32.

At a recent €25.41, this implies 26% upside. Broader consensus rates Ryanair as Outperform with a €26 target, per company data.

easyJet faces FY26 underlying EBIT of £305 million (down 54%) and FY27 at £438 million (down 37%), with fuel costs rising to £2.79 billion from £2.25 billion. Single-digit margins and £3.3 billion FY28 capex add pressure versus projected £1.6 billion EBITDA.

Wizz Air endures the steepest cuts, with net losses forecast through FY28—FY27 EPS down 181%, FY28 down 123%. Net debt/EBITDA hits 3.7x by early 2026 before climbing, worsened by Pratt & Whitney engine groundings impacting 20% of its fleet. Target slashed 48% to £13, implying 39.7% upside from 931.5p but offset by risks.

Bernstein maintains "outperform" on IAG with a £4.70 target (consensus Buy at £4.65) and "market-perform" on Air France-KLM (consensus Hold, €9.7 target) and Lufthansa (consensus Outperform but €6.4 target below €7.24 price).