Norwegian Air Shuttle

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Norwegian Air Shuttle (NAS) is with over 129 destinations worldwide the third largest low-cost carrier in Europe and is ranking among the top-ten largest European airlines in terms of passenger numbers. Last month Norwegian Air Shuttle received the 2016 Grand Travel Award for “Europe’s Best Low-Cost Airline” (Skytrax World Airline Awards).

Norwegian Air Shuttle’s long haul operations launched in 2013 have been struggling during 2014. After a large loss in 2014, Norwegian announced a small positive net income in 2015 due to an increase in sales by 15.6%. Even though its recent upswing, Norwegian Air Shuttle is facing multiple future difficulties. The Norwegian government introduced an air passenger excise duty, beginning 1 April 2016, a strong competition in the Norwegian market, as well as the poor economic development could have according to BizTravel a negative impact on the airline industry.

However, Norwegian Air Shuttle is expected to grow as its long haul network has expanded quickly during the recent years. Also, it has applied for a US foreign carrier permit for its subsidiary, Norwegian Air UK (NAUK), last December. The CAPA Centre for Aviation expects Norwegian Air Shuttle to increase efficiency of its long haul operation because of the permit for routes from the UK to the US. Furthermore, to boost its diversification plans, Norwegian Air Shuttle will open a new hub at “Rom-Fiumicino” Airport (Rome, Italy) in March 2016. The future development remains to be seen.

Bloomberg consensus set the 12-month target price to NOK 319,12. Currently, 9 analysts set Norwegian Air Shuttle on BUY, 3 on HOLD and 5 on SELL recommendation.