Ryanair Holdings plc: Difference between revisions
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Ryanair Holdings plc | {{Infobox airline | ||
| image_size = 250 | |||
| airline = Ryanair | |||
| image = Ryanair.svg | |||
| traded_as = {{unbulleted list|{{EuronextDublin|RYA|IE00BYTBXV33|XDUB}}|[[ISEQ 20]] component|{{NASDAQ|RYAAY}}}} | |||
| IATA = FR | |||
| ICAO = RYR | |||
| callsign = RYANAIR | |||
| aoc = | |||
| hubs = | |||
| focus_cities = | |||
| frequent_flyer = | |||
| alliance = | |||
| subsidiaries = Ryanair DAC<br />[[Malta Air]]<br />[[Buzz (Ryanair)|Buzz]]<br />[[Lauda Europe]]<br>[[Ryanair UK]] | |||
| fleet_size = 563 | |||
| destinations = [[List of Ryanair destinations|222]] | |||
| num_employees = 19,000 (2022)<ref>{{cite web |title=Ryanair-2022-Annual-Report |url=https://investor.ryanair.com/wp-content/uploads/2022/07/Ryanair-2022-Annual-Report.pdf |publisher=Ryanair}}</ref> | |||
| alt = | |||
| founded = {{start date and age|1984|11|28|df=y}}<ref name=founded>{{cite book|last=Aldous|first=Richard|year=2013|title=Tony Ryan: Ireland's Aviator|url=https://books.google.com/books?id=luz4AwAAQBAJ|publisher=Gill & Macmillan Ltd|page=80|isbn=978-0-7171-5781-5}}</ref><!--<br />where?--> | |||
| commenced = {{start date and age|1985|07|08|df=y}} | |||
| bases = {{Collapsible list | |||
| framestyle = border:none; padding:0; | |||
| title = List of bases | |||
|[[Agadir–Al Massira Airport|Agadir]] | |||
|[[Alicante–Elche Miguel Hernández Airport|Alicante]] | |||
|[[Athens International Airport|Athens]] | |||
|[[Josep Tarradellas Barcelona-El Prat Airport|Barcelona]] | |||
|[[Bari Airport|Bari]] | |||
|[[Beauvais–Tillé Airport|Beauvais]] | |||
|[[Belfast International Airport|Belfast International]] | |||
|[[Orio al Serio International Airport|Bergamo]] | |||
|[[Berlin Brandenburg Airport|Berlin]] | |||
|[[Billund Airport|Billund]]<ref>{{cite news|url=https://www.thelocal.dk/20210505/ryanair-relaunches-at-billund-airport-with-26-destinations/|title=Ryanair to relaunch at Billund Airport with 26 destinations|website=[[The Local]]|date=5 May 2021}}</ref> | |||
|[[Birmingham Airport|Birmingham]] | |||
|[[Bologna Guglielmo Marconi Airport|Bologna]] | |||
|[[Bordeaux Mérignac Airport|Bordeaux]] | |||
|[[Bournemouth Airport|Bournemouth]] | |||
|[[Bratislava Airport|Bratislava]] | |||
|[[Brindisi Airport|Brindisi]] | |||
|[[Bristol Airport|Bristol]] | |||
|[[Henri Coandă International Airport|Bucharest]] | |||
|[[Budapest Ferenc Liszt International Airport|Budapest]] | |||
|[[Cagliari-Elmas Airport|Cagliari]] | |||
|[[Catania-Fontanarossa Airport|Catania]] | |||
|[[Chania International Airport|Chania]]<ref name="auto">{{cite web|url=https://corporate.ryanair.com/news/ryanair-opens-three-new-bases-in-greece-for-summer-21/|title=Ryanair Opens Three New Bases In Greece For Summer '21 | Ryanair's Corporate Website|website=corporate.ryanair.com|date=24 March 2021 }}</ref> | |||
|[[Brussels South Charleroi Airport|Charleroi]] | |||
|[[Cologne Bonn Airport|Cologne/Bonn]] | |||
|[[Corfu International Airport|Corfu]]<ref name="auto" /> | |||
|[[Cork Airport|Cork]] | |||
|[[Dublin Airport|Dublin]] (headquarters) | |||
|[[East Midlands Airport|East Midlands]] | |||
|[[Edinburgh Airport|Edinburgh]] | |||
|[[Faro Airport|Faro]] | |||
|[[Fes–Saïss Airport|Fes]] | |||
|[[Gdańsk Lech Wałęsa Airport|Gdańsk]] | |||
|[[Glasgow Prestwick Airport|Glasgow Prestwick]] | |||
|[[Göteborg Landvetter Airport|Gothenburg]] | |||
|[[Frankfurt–Hahn Airport|Hahn]]<ref>{{cite web |title=Ryanair Closes Frankfurt Am Main Base |url=https://corporate.ryanair.com/news/ryanair-closes-frankfurt-am-main-base/ |website=ryanair.com |date=7 January 2022 |access-date=7 January 2022}}</ref> | |||
|[[Ibiza Airport|Ibiza]] | |||
|[[Baden Airpark|Karlsruhe/Baden-Baden]] | |||
|[[Katowice Airport|Katowice]] | |||
|[[Kaunas Airport|Kaunas]] | |||
|[[Kraków John Paul II International Airport|Kraków]] | |||
|[[Lamezia Terme International Airport|Lamezia Terme]] | |||
|[[Leeds Bradford Airport|Leeds/Bradford]] | |||
|[[Lisbon Portela Airport|Lisbon]] | |||
|[[Liverpool John Lennon Airport|Liverpool]] | |||
|[[London Luton Airport|London Luton]] | |||
|[[London Stansted Airport|London Stansted]] (largest base) | |||
|[[Adolfo Suárez Madrid-Barajas Airport|Madrid]] | |||
|[[Málaga Airport|Málaga]] | |||
|[[Malta International Airport|Malta]] | |||
|[[Manchester Airport|Manchester]] | |||
|[[Marrakesh Menara Airport|Marrakesh]] | |||
|[[Marseille Provence Airport|Marseille]] | |||
|[[Memmingen Airport|Memmingen]] | |||
|[[Milan Malpensa Airport|Milan Malpensa]] | |||
|[[Naples International Airport|Naples]] | |||
|[[Newcastle International Airport|Newcastle upon Tyne]] | |||
| [[Nuremberg Airport|Nuremberg]] | |||
|[[Falcone–Borsellino Airport|Palermo]] | |||
|[[Palma de Mallorca Airport|Palma de Mallorca]] | |||
|[[Paphos International Airport|Paphos]] | |||
|[[Galileo Galilei Airport|Pisa]] | |||
|[[Pescara Airport|Pescara]] | |||
|[[João Paulo II Airport|Ponta Delgada]] | |||
|[[Poznań–Ławica Airport|Poznań]] | |||
|[[Václav Havel Airport Prague|Prague]] | |||
|[[Francisco de Sá Carneiro Airport|Porto]] | |||
|[[Rhodes International Airport|Rhodes]]<ref name="auto" /> | |||
|[[Riga International Airport|Riga]]<ref>{{cite web|url=https://www.aviation24.be/airlines/ryanair/ryanair-announces-new-base-in-riga-for-winter-21-with-two-based-aircraft-and-16-new-routes/|title=Ryanair announces new base in Riga for Winter '21 with two based aircraft and 16 new routes|date=28 April 2021}}</ref> | |||
|[[Ciampino–G. B. Pastine International Airport|Rome–Ciampino]] | |||
|[[Leonardo da Vinci–Fiumicino Airport|Rome–Fiumicino]] | |||
|[[Shannon Airport|Shannon]] | |||
|[[San Pablo Airport|Seville]] | |||
|[[Santiago–Rosalía de Castro Airport|Santiago de Compostela]] | |||
|[[Sofia Airport|Sofia]] | |||
|[[Stockholm Arlanda Airport|Stockholm Arlanda]]<ref>{{cite news|url=https://www.thelocal.com/20210506/ryanair-to-start-flying-from-arlanda-this-autumn/|title=Ryanair to start flying from Arlanda this autumn|website=[[The Local]]|date=6 May 2021}}</ref> | |||
|[[Tenerife-South Airport|Tenerife South]] | |||
|[[Thessaloniki International Airport|Thessaloniki]] | |||
|[[Toulouse-Blagnac Airport|Toulouse]] | |||
|[[Treviso Airport|Treviso]]<ref>{{cite web |url=https://corporate.ryanair.com/news/ryanair-announces-new-base-at-venice-treviso-2-based-aircraft-200m-investment-and-18-new-routes/ |title=Ryanair Announces New Base At Venice Treviso |access-date=4 December 2020 |website=ryanair.com|date=4 December 2020 }}</ref> | |||
|[[Turin Airport|Turin]] | |||
|[[Valencia Airport|Valencia]] | |||
|[[Vienna International Airport|Vienna]] | |||
|[[Venice Marco Polo Airport|Venice]]<ref>{{cite web |title=New Ryanair Base At Venice Marco Polo Airport |url=https://corporate.ryanair.com/news/new-ryanair-base-at-venice-marco-polo-airport/ |website=ryanair.com |date=7 October 2021 |access-date=7 October 2021}}</ref> | |||
|[[Vilnius Airport|Vilnius]] | |||
|[[Warsaw Modlin Airport|Warsaw Modlin]] | |||
|[[Copernicus Airport Wrocław|Wrocław]] | |||
|[[Weeze Airport|Weeze]] | |||
|[[Zadar Airport|Zadar]]<ref>{{cite web|url=https://corporate.ryanair.com/news/ryanair-opens-a-new-zadar-base-for-summer-21/|title=Ryanair Opens A New Zadar Base For Summer '21 | Ryanair's Corporate Website|website=corporate.ryanair.com|date=30 March 2021 }}</ref> | |||
|[[Zagreb Airport|Zagreb]]<ref>{{cite web|url=https://corporate.ryanair.com/news/ryanair-announces-new-base-in-zagreb/|title=Ryanair Announces New Base In Zagreb | Ryanair's Corporate Website|website=corporate.ryanair.com|date=30 March 2021 }}</ref>}} | |||
| secondary_hubs = | |||
| lounge = | |||
| headquarters = [[Swords, Dublin]], Ireland | |||
| key_people = {{indented plainlist| | |||
* [[David Bonderman]] (Chairman) | |||
* [[Michael O'Leary (businessman)|Michael O'Leary]] {{nowrap|(Group [[CEO]])}} | |||
* Edward Wilson {{nowrap|(Ryanair CEO)}} | |||
}} | |||
| revenue = {{increase}} {{€|10.775 billion|link=yes}} (2023) | |||
| operating_income = <!-- {{increase}} {{€|x.xxx billion}} (2023) --> | |||
| net_income = {{increase}} {{€|1.314 billion}} (2023) | |||
| assets = {{increase}} {{€|16.406 billion}} (2023) | |||
| equity = {{increase}} {{€|5.643 billion}} (2023) | |||
| website = {{URL|https://www.ryanair.com|ryanair.com}} | |||
}} | |||
Ryanair Holdings plc and its subsidiaries stand as a prominent provider of scheduled passenger airline services across various European nations, including Ireland, the United Kingdom, Italy, Spain, and Germany. Beyond its fundamental airline operations, the company delves into a myriad of ancillary services, offering non-flight scheduled and Internet-related services, in-flight sales of beverages, food, duty-free items, and merchandise. Additionally, it facilitates the marketing of car hire, accommodation services, and travel insurance through its digital platforms – its website and mobile app. | |||
Moreover, Ryanair extends its reach by offering a comprehensive suite of services that encompasses aircraft and passenger handling, ticketing, and essential maintenance and repair services. The company also endorses a variety of airport-based services and travel extras like car parking, fast-track, airport transfers, and local attractions and activities, all accessible via its online platforms. Gift vouchers are also available for purchase. | |||
As of June 30, 2022, Ryanair showcased a robust principal fleet, comprising approximately 483 Boeing 737 aircraft and 29 Airbus A320 aircraft. The airline facilitates roughly 3,000 short-haul flights daily, connecting around 225 airports and steadfastly serving its vast customer base. Established in 1985, Ryanair Holdings plc proudly anchors its headquarters in Swords, Ireland, persevering as a pivotal player in the European airline industry. | |||
== Valuation == | |||
=== Discounted Cash Flow Analysis === | |||
===== Historical Cash Flows: ===== | |||
Ryan Air's annual free cash flows from the past 10 years<ref><nowiki>https://www.macrotrends.net/stocks/charts/RYAAY/ryanair-holdings/free-cash-flow</nowiki></ref>: | |||
{| class="wikitable" | |||
!Year | |||
!Annual Free Cashflow (£ Mn) | |||
|- | |||
|2023 | |||
|2,063.22 | |||
|- | |||
|2022 | |||
|1,010.68 | |||
|- | |||
|2021 | |||
|(3,072.54) | |||
|- | |||
|2020 | |||
|831.96 | |||
|- | |||
|2019 | |||
|545.19 | |||
|- | |||
|2018 | |||
|892.85 | |||
|- | |||
|2017 | |||
|523.90 | |||
|- | |||
|2016 | |||
|1,133.79 | |||
|- | |||
|2015 | |||
|1,143.06 | |||
|- | |||
|2014 | |||
|722.26 | |||
|- | |||
|2013 | |||
|918.44 | |||
|- | |||
|2012 | |||
|1,006.38 | |||
|- | |||
|2011 | |||
|(146.75) | |||
|- | |||
|2010 | |||
|52.45 | |||
|- | |||
|2009 | |||
|36.00 | |||
|} | |||
===== Projected Cash Flows: ===== | |||
Projected cash flow values for the next 10 years, based on an earnings growth prediction rate of 12.3%<ref>[https://simplywall.st/stocks/ie/transportation/ise-rya/ryanair-holdings-shares/future#:~:text=Ryanair%20Holdings%20is%20forecasted%20to,be%2025.3%25%20in%203%20years. https://simplywall.st/stocks/ie/transportation/ise-rya/ryanair-holdings-shares/future#:~:text=Ryanair%20Holdings%20is%20forecasted%20to,be%2025.3%25%20in%203%20years.]</ref>: | |||
{| class="wikitable" | |||
!Year | |||
!Projected cash flow (£Mn) | |||
|- | |||
|2024 | |||
|2,317.00 | |||
|- | |||
|2025 | |||
|2,601.99 | |||
|- | |||
|2026 | |||
|2,922.03 | |||
|- | |||
|2027 | |||
|3,281.44 | |||
|- | |||
|2028 | |||
|3,685.06 | |||
|- | |||
|2029 | |||
|4,138.32 | |||
|- | |||
|2030 | |||
|4,647.33 | |||
|- | |||
|2031 | |||
|5,218.96 | |||
|- | |||
|2032 | |||
|5,860.89 | |||
|- | |||
|2033 | |||
|6,581.78 | |||
|} | |||
===== Determining a Discount Rate: ===== | |||
A WACC value was calculated as follows: | |||
''UK 10 Year Government Bond Yield = 4.43% (government data)'' | |||
''Beta value = 1.45''<ref>https://finance.yahoo.com/quote/RYAAY/?guccounter=1&guce_referrer=aHR0cHM6Ly93d3cuZ29vZ2xlLmNvbS8&guce_referrer_sig=AQAAAA-QsnB5Z3NE6_hbXttVYrUnEYFEWtxrdExBHRP0wG2Rwy_Q5T0mlSLNPF2WwFhQbDYfevMryfNXYe8P_oYpm8Xt7ytyiQCF8KpRHed-kXXUK8BorxHOIxb-yyG92X5Dx2IfOOw3sPZlEWgKeH5FetsTHRtMu9XR-g5kdP4aoX-1</ref> | |||
''Assumed market return premium = 6% (government data)'' | |||
WACC = [risk-free rate] + [beta value * assumed market return premium] | |||
WACC = [4.43%] + [1.45 * 6%] | |||
WACC = 13.13% | |||
===== Present value of predicted future cash flows: ===== | |||
The present value of each predicted cash flow (over the next 10 years), after the discount rate had been applied as follows: | |||
Present value of cash flow = { predicted cash flow } / { (1 + WACC)^(number of years) } | |||
{| class="wikitable" | |||
!Year | |||
!Present value of predicted cash flow (£Mn) | |||
|- | |||
|2024 | |||
|2,048.08 | |||
|- | |||
|2025 | |||
|2,033.06 | |||
|- | |||
|2026 | |||
|2,018.14 | |||
|- | |||
|2027 | |||
|2,003.33 | |||
|- | |||
|2028 | |||
|1,988.64 | |||
|- | |||
|2029 | |||
|1,974.05 | |||
|- | |||
|2030 | |||
|1,959.56 | |||
|- | |||
|2031 | |||
|1,945.19 | |||
|- | |||
|2032 | |||
|1,930.92 | |||
|- | |||
|2033 | |||
|1,916.75 | |||
|} | |||
===== Net present / intrinsic value of Ryan Air: ===== | |||
The net present value was calculated by summing the present values of predicted cash flows over the next 10 years: | |||
Net present value = £19 817.71 Mn (£19.82 Bn) | |||
===== Comparison with present market cap of Ryan Air: ===== | |||
Given that the net present value (£19.82 Bn) calculated from the DCF analysis is less than the current market cap of Ryan Air (£18.98 Bn - as of October 2023<ref>[https://companiesmarketcap.com/ryanair/marketcap/#:~:text=Market%20cap%3A%20%2422.31%20Billion,cap%20according%20to%20our%20data. https://companiesmarketcap.com/ryanair/marketcap/#:~:text=Market%20cap%3A%20%2422.31%20Billion,cap%20according%20to%20our%20data.]</ref>) - it is possible that Ryan Air is ''potentially undervalued'', calling for a sensitivity analysis to be carried out. | |||
== References and notes == | |||
__INDEX__ |
Latest revision as of 13:07, 11 October 2023
Ryanair Holdings plc and its subsidiaries stand as a prominent provider of scheduled passenger airline services across various European nations, including Ireland, the United Kingdom, Italy, Spain, and Germany. Beyond its fundamental airline operations, the company delves into a myriad of ancillary services, offering non-flight scheduled and Internet-related services, in-flight sales of beverages, food, duty-free items, and merchandise. Additionally, it facilitates the marketing of car hire, accommodation services, and travel insurance through its digital platforms – its website and mobile app.
Moreover, Ryanair extends its reach by offering a comprehensive suite of services that encompasses aircraft and passenger handling, ticketing, and essential maintenance and repair services. The company also endorses a variety of airport-based services and travel extras like car parking, fast-track, airport transfers, and local attractions and activities, all accessible via its online platforms. Gift vouchers are also available for purchase.
As of June 30, 2022, Ryanair showcased a robust principal fleet, comprising approximately 483 Boeing 737 aircraft and 29 Airbus A320 aircraft. The airline facilitates roughly 3,000 short-haul flights daily, connecting around 225 airports and steadfastly serving its vast customer base. Established in 1985, Ryanair Holdings plc proudly anchors its headquarters in Swords, Ireland, persevering as a pivotal player in the European airline industry.
ValuationEdit
Discounted Cash Flow AnalysisEdit
Historical Cash Flows:Edit
Ryan Air's annual free cash flows from the past 10 years[12]:
Year | Annual Free Cashflow (£ Mn) |
---|---|
2023 | 2,063.22 |
2022 | 1,010.68 |
2021 | (3,072.54) |
2020 | 831.96 |
2019 | 545.19 |
2018 | 892.85 |
2017 | 523.90 |
2016 | 1,133.79 |
2015 | 1,143.06 |
2014 | 722.26 |
2013 | 918.44 |
2012 | 1,006.38 |
2011 | (146.75) |
2010 | 52.45 |
2009 | 36.00 |
Projected Cash Flows:Edit
Projected cash flow values for the next 10 years, based on an earnings growth prediction rate of 12.3%[13]:
Year | Projected cash flow (£Mn) |
---|---|
2024 | 2,317.00 |
2025 | 2,601.99 |
2026 | 2,922.03 |
2027 | 3,281.44 |
2028 | 3,685.06 |
2029 | 4,138.32 |
2030 | 4,647.33 |
2031 | 5,218.96 |
2032 | 5,860.89 |
2033 | 6,581.78 |
Determining a Discount Rate:Edit
A WACC value was calculated as follows:
UK 10 Year Government Bond Yield = 4.43% (government data)
Beta value = 1.45[14]
Assumed market return premium = 6% (government data)
WACC = [risk-free rate] + [beta value * assumed market return premium]
WACC = [4.43%] + [1.45 * 6%]
WACC = 13.13%
Present value of predicted future cash flows:Edit
The present value of each predicted cash flow (over the next 10 years), after the discount rate had been applied as follows:
Present value of cash flow = { predicted cash flow } / { (1 + WACC)^(number of years) }
Year | Present value of predicted cash flow (£Mn) |
---|---|
2024 | 2,048.08 |
2025 | 2,033.06 |
2026 | 2,018.14 |
2027 | 2,003.33 |
2028 | 1,988.64 |
2029 | 1,974.05 |
2030 | 1,959.56 |
2031 | 1,945.19 |
2032 | 1,930.92 |
2033 | 1,916.75 |
Net present / intrinsic value of Ryan Air:Edit
The net present value was calculated by summing the present values of predicted cash flows over the next 10 years:
Net present value = £19 817.71 Mn (£19.82 Bn)
Comparison with present market cap of Ryan Air:Edit
Given that the net present value (£19.82 Bn) calculated from the DCF analysis is less than the current market cap of Ryan Air (£18.98 Bn - as of October 2023[15]) - it is possible that Ryan Air is potentially undervalued, calling for a sensitivity analysis to be carried out.
References and notesEdit
- ↑ Aldous, Richard (2013). Tony Ryan: Ireland's Aviator. Gill & Macmillan Ltd. p. 80. ISBN 978-0-7171-5781-5.
- ↑ "Ryanair to relaunch at Billund Airport with 26 destinations". The Local. 5 May 2021.
- ↑ 3.0 3.1 3.2
- ↑
- ↑
- ↑ "Ryanair to start flying from Arlanda this autumn". The Local. 6 May 2021.
- ↑
- ↑
- ↑
- ↑
- ↑
- ↑ https://www.macrotrends.net/stocks/charts/RYAAY/ryanair-holdings/free-cash-flow
- ↑ https://simplywall.st/stocks/ie/transportation/ise-rya/ryanair-holdings-shares/future#:~:text=Ryanair%20Holdings%20is%20forecasted%20to,be%2025.3%25%20in%203%20years.
- ↑ https://finance.yahoo.com/quote/RYAAY/?guccounter=1&guce_referrer=aHR0cHM6Ly93d3cuZ29vZ2xlLmNvbS8&guce_referrer_sig=AQAAAA-QsnB5Z3NE6_hbXttVYrUnEYFEWtxrdExBHRP0wG2Rwy_Q5T0mlSLNPF2WwFhQbDYfevMryfNXYe8P_oYpm8Xt7ytyiQCF8KpRHed-kXXUK8BorxHOIxb-yyG92X5Dx2IfOOw3sPZlEWgKeH5FetsTHRtMu9XR-g5kdP4aoX-1
- ↑ https://companiesmarketcap.com/ryanair/marketcap/#:~:text=Market%20cap%3A%20%2422.31%20Billion,cap%20according%20to%20our%20data.