After immersing 20% ​​in a month, the price of IAG shares returns in deep value territory?

He IAG (LSE: IAG) The price of shares doubled last year, so it is the best performance in the Ftse 100. Investors who wanted to add the shares to their portfolio may have unfortunately decided to have lost their chance as a result.

Now they have a second chance. Actions at International Consolidated Airlines Group, parent company British airways, Iberia, Aer Lingus and PlugSuddenly 20% have fallen in the last month. However, 80% have still risen for 12 months.

Investors who like to buy good companies in bad news can be tempted. I think this is a good part. The question is, how bad can the news be?

Is the FTSE 100 a purchase opportunity?

IAG was obviously beaten by the pandemic that based its fleets and left the company with great debts. For years, its price / profits ratio was one of the lowest in FTSE 100, with about three or four.

Then, last year, investors decided that he had suffered enough. As the US economy was avino, they saw a great opportunity in transatlantic trips, which IAG could take advantage of British Airways.

On February 28, the results of the whole year seemed to justify their trust. The revenues of the fourth quarter increased 11% to € 8 billion, exceeding the expectations of € 7.7 billion, while the underlying operational profits fired 91% to € 961 million. The consensus had suggested only 754 million euros.

With a free cash flow that jumps 29% to € 3.6 billion, the Board felt safe enough to announce a repurchase of shares of 1 billion euros. I clearly felt that there was still a lot of value in the stock.

Donald Trump enters. Markets fear European commercial rates and the possible recession of the United States will reach the demand for transatlantic flights. Therefore, that fall.

Many will be tempted, despite the dangers. IAG's P/E relationship is back below six, which suggests that the action is seriously undervalued in relation to its profit potential.

Even if the shares are folded, investors can now expect dividends. The final yield is 2.74%, but it is forecast to reach 3.36% this year and 3.83% in 2026.

Dividends and shares of shares also

Dividends are not guaranteed, of course, and shareholders' payments could receive a blow if IAG's profits do. Any deceleration in profits could also hinder progress to pay the group's debt, which is still £ 5.7 billion.

Market analysts are still optimistic. The 26 analysts who offer pricing prices of one -year shares have produced an average objective of 390p. If necessary, this projection represents an increase of more than 40% of current levels.

However, most of these forecasts were probably done before recent volatility, and cannot completely explain Trump's challenges.

An investor that considers IAG's actions today has to have a vision of how the trade war will work. The problem is that nobody knows, not even Trump. Today's uncertainty looks like a purchase opportunity, but only for investors who plan to maintain shares for at least five years, and ideally longer.

With luck, by then, today's rashes will have been calmed. But it is also worth noting that airlines seem to be on the first line of each economic, geopolitical and meteorological disturbance. IAG can remain full of potholes, but to answer my own question, I think we are seeing a deep value today.