Have you been paying attention to shares of Ryanair (RYAAY)? Shares have been on the move with the stock up 11.7% over the past month. The stock hit a new 52-week high of $74.24 in the previous session. Ryanair has gained 2.3% since the start of the year compared to the 3% gain for the Zacks Transportation sector and the 20.4% return for the Zacks Transportation - Airline industry.
What's Driving the Outperformance?
The stock has an impressive record of positive earnings surprises, as it hasn't missed our earnings consensus estimate in any of the last four quarters. In its last earnings report on November 3, 2025, Ryanair reported EPS of $3.76 versus consensus estimate of $3.62 while it missed the consensus revenue estimate by 0.22%.
For the current fiscal year, Ryanair is expected to post earnings of $4.8 per share on $17.81 in revenues. This represents a 53.85% change in EPS on a 18.35% change in revenues. For the next fiscal year, the company is expected to earn $5.45 per share on $18.79 in revenues. This represents a year-over-year change of 13.65% and 5.52%, respectively.
Valuation Metrics
Though Ryanair has recently hit a 52-week high, what is next for Ryanair? A key aspect of this question is taking a look at valuation metrics in order to determine if the company has run ahead of itself.
On this front, we can look at the Zacks Style Scores, as these give investors a variety of ways to comb through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. Investors should consider the style scores a valuable tool that can help you to pick the most appropriate Zacks Rank stocks based on their individual investment style.
Ryanair has a Value Score of A. The stock's Growth and Momentum Scores are B and B, respectively, giving the company a VGM Score of A.
In terms of its value breakdown, the stock currently trades at 15.4X current fiscal year EPS estimates, which is a premium to the peer industry average of 9.8X. On a trailing cash flow basis, the stock currently trades at 12.9X versus its peer group's average of 5.5X. Additionally, the stock has a PEG ratio of 0.76. This is good enough to put the company in the top echelon of all stocks we cover from a value perspective, making Ryanair an interesting choice for value investors.
Zacks Rank
We also need to consider the stock's Zacks Rank, as this supersedes any trend on the style score front. Fortunately, Ryanair currently has a Zacks Rank of #2 (Buy) thanks to a solid earnings estimate revision trend.
Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if Ryanair passes the test. Thus, it seems as though Ryanair shares could have a bit more room to run in the near term.
How Does RYAAY Stack Up to the Competition?
Shares of RYAAY have been soaring, and the company still appears to be a decent choice, but what about the rest of the industry? One industry peer that looks good is LATAM Airlines Group S.A. (LTM). LTM has a Zacks Rank of #2 (Buy) and a Value Score of A, a Growth Score of A, and a Momentum Score of D.
Earnings were strong last quarter. LATAM Airlines Group S.A. beat our consensus estimate by 3.17%, and for the current fiscal year, LTM is expected to post earnings of $5.81 per share on revenue of $14.42 billion.
Shares of LATAM Airlines Group S.A. have gained 11% over the past month, and currently trade at a forward P/E of 9.77X and a P/CF of 17.56X.
The Transportation - Airline industry may rank in the bottom 71% of all the industries we have in our universe, but there still looks like there are some nice tailwinds for RYAAY and LTM, even beyond their own solid fundamental situation.
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Ryanair Holdings PLC (RYAAY): Free Stock Analysis Report LATAM Airlines Group S.A. (LTM): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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