Initially Delta, but now Omicron … Covid-19 variants are interfering with life around the world, but as an optimist, you have to try something positive from the current Omicron turmoil. It will not be. To me, Omicron makes a lot of cheap stocks, and I think the IAG stock price in particular looks like a particularly good one at this point.
Meeting of airlines IAG (LSE: IAG) Not surprisingly, it’s the type of business that suffers from the turmoil of Omicron. In the current world system, the new Covid-19 variant Omicron equates to tighter control over international travel and discourages passengers from flying. This means that IAG and other travel-centric businesses will lose revenue. I think there is certainly a reason to seize the opportunity that the recent fall in IAG stock prices is only a temporary fall.
Look at IAG’s 12-month stock price
I feel like we were here with Omicron before. Scrolling 12 months ago until Britain returned to its blockage before Christmas 2020, the world felt like it was cave exploring again. But do you remember what happened?
We all got over January 2021 and the world began to feel a little more open and lived as much as we could by summer and autumn. Now we are a little depressed again at Omicron.
Take a look at the 12-month IAG stock price trends to see how it fits into that pessimism-optimism-pessimism pattern. Please call me angry if you like, but I would like to pay close attention to the power of public opinion to shift the stock price. Sometimes public opinion goes crazy in the stock market rather than a sure fact. I think the IAG over the past year has demonstrated this.
Strong IAG management support
I’m not as angry as investing in a business based on this alone, so it’s important to understand the risks associated with investing in IAG. It is clear every day that the world has not yet escaped from the pandemic, and the longer it takes, the longer it will take to return to a complete overseas trip.For businesses operating brands of iconic international long-haul airlines such as: British Airways, Iberia When Aer Lingus, This is of course a problem.
I also know that IAG is at a loss and continues to operate. The losses are very large and look horrifying, but I think the recently reported operating loss of € 485 million needs to be forecasted.
IAG is not the only airline group that is facing a difficult time at this time. One of the things the group has in the long run is the strong brand mentioned above. Also, past investment in brand marketing will pay off in the coming years. Using € 10.6 billion in cash in the form of a loan will not adversely affect the IAG.
Overall, IAG stocks now feel cheap to me. I’m stuck because I’m happy to be able to sit in stock this week, especially in the long run. Time tells me how to ride!
Gary McGibbon does not have a position in any of the shares mentioned. The Motley Fool UK does not have a position in any of the shares mentioned. The views expressed about the companies mentioned in this article are those of the author and may differ from the official recommendations made by subscription services such as Share Advisor, Hidden Winners, and Pro. Here at The Motley Fool, given the various insights, A better investor than us.
Omicron makes IAG’s stock price look cheap!
https://www.fool.co.uk/2021/12/14/omicron-is-making-the-iag-share-price-look-cheap-to-me/ Omicron makes IAG’s stock price look cheap!