IAG

Analysis of IAG share price

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Before starting to make investments in the IAG share price, online or through your stock market portfolio, you must make sure that you have all the elements necessary to carry out your analyses of this stock. That's what you'll find in this article entirely devoted to this stock and this listed company. You'll find what the activities and sources of income of the group are as well as who its main competitors and strategic allies are and the elements that you'll need to take into account in your fundamental analyses.

Elements that can influence the price of this asset:

Analysis N°1

First of all, closely monitor the development of the IAG group's international activities with the establishment of new lines or new airlines in areas that are still hardly exploited, including Asia Pacific.

Analysis N°2

It's also important to follow orders for new devices from IAG, which allow us to better understand the group's forecasts for its activities in the years to come.

Analysis N°3

The strategic operations put in place by the group will also be of the greatest importance and should be monitored, specifically the new acquisitions made. IAG is developing mainly by purchasing airlines in order to expand its network and market share.

Analysis N°4

The competition will also have to be watched closely with two main competitors of equivalent size, however, you should take into account the competition exerted by operators alone such as low-cost companies, a segment in which IAG is still too little represented.

Analysis N°5

As IAG owns several airlines, it's also important to follow the most important news closely in terms of weight in the overall turnover of the group.

Analysis N°6

Finally, taking into account both the annual or quarterly results of the company goes without saying, with the publication of figures that you should compare to analysts' forecasts as well as to any strategic plans communicated by the group.

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General presentation of IAG

Now let's take the time to have a closer look at the IAG group and its core businesses. Sound knowledge of this group and its main sources of income is essential if you wish to grasp the challenges and possibilities for future growth.

The IAG group for International Consolidated Airlines Group is a British company specializing in air transport. More precisely, it is currently one of the main airlines in Europe.

To better understand the Company's activities, you can divide them into several divisions according to the percentage of turnover they generate like so:

  • The largest part of its income comes from passenger transport with over 118.3 million people transported in 2019. This activity alone generates 88.1% of the group's turnover.
  • Then there are freight transport activities which generate 4.4% of turnover.
  • The balance of IAG's turnover, i.e. 7.5%, comes from maintenance and handling services, distribution of reservation systems and others.

Currently, the group operates a fleet of 598 aircrafts.

Geographically, the IAG group generates 32.8% of its turnover in the United Kingdom, 17.2% in Spain, 17.2% in the United States and 32.8% in the rest of the world.

Analysis of IAG share price
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The major competitors of IAG

It's also important to be familiar with the competitive environment in which the IAG group operates. Here is a quick overview of its two main competitors on the market today.

Air France - KLM 

First of all, the Franco-Dutch alliance Air France - KLM, which brings together two main airlines along with six other subsidiary companies, is one of IAG's main competitors. The group is organized around a holding company in which the French State is a 14.3% shareholder and the Dutch State 14%. The group practices passenger transport, freight transport, aeronautical maintenance and servicing as well as services. Currently, Air France KLM is the fourth largest airline in Europe by number of passengers carried and the first for long-haul destinations and its non-integrator cargo activities. It is also one of the world's leading providers of maintenance services through its subsidiary Air France Industries KLM Engineering.

Lufthansa 

The other major competitor to watch is the Lufthansa group which brings together several airlines including Lufthansa, Swiss, Austrian Airlines and Brussels Airlines. More specifically, this group is organized into three different divisions with the Network Airlines division, the Eurowings division and the Aviation Services division. The group is made up of Lufthansa which is the German national company at the origin of the group's creation in 1995 which includes regional companies such as Lufthansa CityLine and Air Dolomiti. Austrian Airlines has been the group's Austrian flag carrier since 2008 and is based at Vienna Airport. Brussels Airlines is the Belgian national company which integrated the group 100% in 2016 and which is based at Brussels airport. Finally, the company Swiss International Airlines or Swiss is the Swiss national company which is based both at Geneva and at Zurich airport and joined the group in 2007. This also includes the Edelweiss Air subsidiary.


The major partners of IAG

Now that you are well acquainted with the main competitors of the IAG group, check out who its strategic allies are through two examples of partnerships that the group has put in place in recent years:

Amadeus 

First in 2020, it's with the Amadeus group that the International Airlines Group established a strategic partnership aimed to promote the sale of travel products through the NDC. As part of this agreement, the content of IAG companies including British Airways, Iberia, Aer Lingus and Vueling are made available to travel sellers, agents and businesses through the Amadeus Travel Platform via Amadeus NDC solutions. First of all, the British Airways and Iberia NDC connections will be affected before that of Vueling in 2022. This agreement represents a new step in the strategy implemented by the two groups with the aim of adopting new digital sales methods. The partnership improves the sales experience of users and gives them access to current and future personalized offers such as additional price points.

American Airlines 

Another significant partnership that has just been strengthened has been signed with American Airlines for its British Airways co-branded cards and membership rewards programs. Regarding the multi-year renewal, American Express will pay nearly 750 million pounds or 825 million euros according to statements from IAG.

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Frequently Asked Questions

Which subsidiaries are owned and operated by the IAG group?

The IAG group operates through various subsidiaries. It owns Aer Lingus in Italy, British Airways and its subsidiaries BA CityFlyer, and BMI in England, OpenSkies in France, Comair Limited in Senegal (18% owned) and Sun Air in Switzerland as well as the company Iberia and its subsidiaries Air Nostrum, Level and Vueling in Spain.

How is the IAG group's capital distributed and who are its major shareholders?

The IAG group is a listed group whose capital is divided between private and individual shareholders as well as a part in treasury. Currently, the largest private shareholders of the group are the Qatar Government with 21.5% of the shares, Capital Research & Management with 12.76%, Lansdowne Partners LLP with 16.1%, The Vanguard Group with 1.33% and Norges Bank Investment Management with 1.27% of the shares.

Which analysis should be favoured for the IAG share?

To determine which way the IAG share price is most likely to move, you should ideally perform two main types of analysis. There is of course the technical analysis which is based on the study of the graphical indicators and the fundamental analysis which focuses on the external elements likely to have an influence.

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