Can the Qantas share price be a top performer again in 2025?

How high can Qantas shares soar?

| More on:
A woman sits crossed legged on seats at an airport holding her ticket and smiling.

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The Qantas Airways Ltd (ASX: QAN) share price had an excellent 2024, rising more than 69%. However, that was last year. What can the ASX travel share achieve in 2025?

Past performance is not a guarantee of future performance, particularly with a return as high as 70%. There's no guarantee that Qantas will remain at its current valuation of above $9.

Created with Highcharts 11.4.3Qantas Airways PriceZoom1M3M6MYTD1Y5Y10YALL1 Jan 202410 Feb 2025Zoom ▾Jan '24Mar '24May '24Jul '24Sep '24Nov '24Jan '25Jan '24Jan '24May '24May '24Sep '24Sep '24Jan '25Jan '25www.fool.com.au

The company has benefited from ongoing strong demand for travel, which has also helped with achieving appealing airfares. Plus, fuel costs have reduced in the last few years following the Russian invasion of Ukraine.

So, let's look into whether the business could be a top performer again in 2025.

Is the current Qantas share price valuation justified?

When Qantas shares were trading at $8.94 in late December, the broker UBS gave some thoughts on why the airline had flown so high in 2024:

We believe the rally in international airlines and the broader market has provided a strong tailwind; however, we also believe growing confidence in the sustainability of post-COVID earnings and, in turn, consensus forecasts stabilising is allowing the multiple to re-rate.

In other words, Qantas has partly benefited from the rally in the share prices of other airlines and the overall ASX share market.

UBS also believes that other experts are more confident that the current earnings level can be maintained after all of the travel disruptions during the pandemic.

Can it rise even further in 2025?

The broker is seeing "strong momentum in fare growth" for both domestic and international with Qantas and Jetstar brands. If fares strengthen, UBS thinks Qantas' profit could beat the projections of what the broker and the market are expecting.

UBS forecasts Qantas could generate $23.5 billion of revenue, $2.58 billion of operating profit (EBIT) and $1.64 billion of net profit after tax (NPAT) in FY25. This could translate into earnings per share (EPS) of $1.06 and enable a dividend per share of 20 cents per share.

At the current Qantas share price, that means the airline is valued at less than 9x FY25's estimated earnings with a possible dividend yield of 2.1%, excluding possible franking credits.

UBS currently has a price target of $9 on the airline, which implies a slight fall in 2025. However, as the broker noted, if Qantas' earnings impress, then it could justify a higher valuation than $9. But that may require the ASX travel share to outperform expectations.

Should you invest $1,000 in Qantas Airways Limited right now?

Before you buy Qantas Airways Limited shares, consider this:

Motley Fool investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now... and Qantas Airways Limited wasn't one of them.

The online investing service he’s run for over a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

And right now, Scott thinks there are 5 stocks that may be better buys...

See The 5 Stocks *Returns as of 30 April 2025

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Travel Shares

A corporate-looking woman looks at her mobile phone as she pulls along her suitcase in another hand while walking through an airport terminal with high glass panelled walls.
Travel Shares

After lowering its guidance, what's Macquarie's price target on Corporate Travel Management shares?

What does this broker have to say about the travel company?

Read more »

Man sitting in a plane seat works on his laptop.
Travel Shares

Why did the Qantas share price lose altitude in April?

Qantas shares didn’t join in April’s ASX 200 rebound. But why?

Read more »

Man waiting for his flight and looking at his phone.
Travel Shares

Corporate Travel shares crash 11% as Trump tariffs bite

Trump’s tariffs are roiling Corporate Travel shares on Friday.

Read more »

A family walks along the tarmac towards a plane representing more people travelling as ASX travel shares recover
Travel Shares

How lower interest rates could send this beaten down ASX All Ords stock flying

A leading expert says this sold-off ASX All Ords stock is ‘well placed for growth’.

Read more »

Woman on a tablet waiting in for her flight in an airport and looking through a window.
Travel Shares

After a guidance downgrade, what does Macquarie think Flight Centre shares are worth?

Is this stock great value after its downgrade?

Read more »

Woman on a tablet waiting in for her flight in an airport and looking through a window.
Travel Shares

Will lower US travel impact Flight Centre shares?

New data reveals an uncertain future for US travel. Here’s how it could impact travel shares. 

Read more »

Couple at an airport waiting for their flight.
Travel Shares

Why is the Flight Centre share price sinking today?

ASX investors are bidding down Flight Centre shares on Monday. But why?

Read more »

A happy family of four on holidays stand on a jetty and cheer.
Travel Shares

Travel to the US is down this year. Will Australia's tourism sector benefit?

2025 could prove to be a good year for Australian hotel operators.

Read more »