Ryanair's EPS Estimates Northbound: Time to Buy the Stock?

European carrier, Ryanair Holdings RYAAY,has been benefiting from upbeat travel demand. RYAAY’s measures to expand its fleet and cater to the rising travel demand also look encouraging. A solid balance sheet implies RYAAY’s financial flexibility. The positive sentiment surrounding RYAAY stock is evident from the fact that the Zacks Consensus Estimate for the second quarter and full-year 2025 earnings has been revised upward in the past 90 days.

The Zacks Consensus Estimate for the second quarter and full-year 2025 earnings per share indicates growth of 77.9% and 30.5% from the respective 2024 figures. The company’s long-term (three to five years) earnings growth rate is 13.76%.

Let’s delve deeper.

Upbeat Air Travel Demand & Fleet Additions Aid RYAAY

Passenger volume has been robust at Ryanair following the end of the pandemic and normalization of economic activities. With travel bookings rising across the industry, passenger revenues at Ryanair are also rising. Because of this air-travel demand strength, RYAAY's traffic grew 9% in fiscal 2024. In fiscal 2025, Ryanair carried more than 200.2 million passengers, becoming the first European carrier to do so in a year. Given this encouraging backdrop, Ryanair expects its fiscal 2026 traffic to grow 3% to 206 million passengers.

Ryanair’s fleet-modernization initiatives to cater to the improvement in travel demand are encouraging. The inclusion of modern planes in its fleet and the retirement of the old ones aligns with its environmentally-friendly approach. Between March 1999 and March 2025, Ryanair took delivery of 532 Boeing 737NG aircraft, one Boeing 737-700 aircraft and 176 new Boeing 737-8200s under its contracts with Boeing and disposed of 122 Boeing 737NG aircraft, including 77 lease hand-backs. During fiscal 2025, Ryanair took delivery of 30 new Boeing 737-8200 aircraft. The latest inclusions, apart from having all basic amenities, result in improved fuel efficiency.

As of March 31, 2025, 181 of the 210 Boeing 737-8200 aircraft (to be purchased under the 2014 contract) had been delivered. The remaining 29 aircraft are expected to be delivered ahead of the summer season of fiscal 2025. In May 2023, 300 new Boeing 737-MAX-10 aircraft orders were placed for delivery between 2027 and 2033. Ryanair expects these fuel-efficient MAX jets to generate substantial growth.

Some Other Tailwinds Working in Favor of RYAAY Stock

RYAAY has a solid balance sheet. The low-cost carrier ended fourth-quarter fiscal 2025 with cash and cash equivalents of $4.28 billion, much higher than the current debt level of $911 million. This implies that the company has sufficient cash to meet its current debt obligations. Meanwhile, the long-term debt level has decreased to $1.81 billion at the end of fourth-quarter fiscal 2025 from $2.74 billion at fourth-quarter fiscal 2024-end. RYAAY's efforts to repay its debts are encouraging too.

Concurrent with earnings announcement for the fourth quarter of fiscal 2025 (ended March 31, 2025), RYAAY announced its plans to pay down maturing bond debt (which includes an €850 million bond in September 2025 and €1.2 billion in May 2026), while still funding its aircraft and engine capex from internal resources.

Long-Term Debt to Capitalization

A strong balance sheet enables the company to reward shareholders with dividends and share repurchases. In line with its capital allocation policy, €0.40 cumulative dividends per share were paid during fiscal 2025, and a final dividend of €0.227 per share is due in September 2025 (subject to AGM approval).

RYAAY is also active on the share buyback front. During fiscal 2025, Ryanair purchased and canceled 7% of its issued share capital, comprising more than 77 million shares, and has now retired almost 36% of its issued share capital since 2008. In April 2025, RYAAY repurchased almost 1 million shares, completing the €800 million share buyback program. In May 2025, RYAAY’s board approved a follow-on €750 million share buyback program, which will likely run for the next six to 12 months.

RYAAY's Price Performance Soars

Shares of RYAAY have had a good time on the bourses of late, improving in double digits so far this year. The encouraging price performance resulted in RYAAY outperforming the Zacks Airline industry in the said time frame. Additionally, RYAAY’s price performance is favorable to that of other airline operators like Alaska Air Group, Inc. (ALK) and Allegiant Travel Company (ALGT) in the same timeframe.

RYAAY Stock YTD Price Comparison

Wrapping Up

The positives surrounding the stock (as highlighted throughout the write-up) outweigh the concerns regarding the production delays at Boeing, high staff costs and escalated air traffic control fees. We, therefore, encourage investors to add RYAAY stock to their portfolios for healthy returns. The company’s Zacks Rank #1 (Strong Buy) further supports our thesis. You can see the complete list of today’s Zacks #1 Rank stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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