Broker tips: IAG, Wizz Air, Atlantic Lithium, Rightmove

(Sharecast News) - Analysts at Deutsche Bank downgraded British Airways parent International Airlines Group and low-cost carrier Wizz Air from 'buy' to 'hold' on Thursday, stating they were now pricing in "a more turbulent outlook".

Deutsche Bank said it now sees "a less positive outlook" for EU airlines, which have rallied more than 20% from lows reached on 7 March in the aftermath of Russia's invasion of Ukraine.

The German bank said its key concerns were a potentially weaker EU consumer, due to inflationary pressures on disposable income, and elevated oil prices.

"We don't expect the airlines to be able to pass all of the fuel cost headwind we now envisage on to customers, especially next year when those headwinds look set to be greater and by which time we think some of the pent-up demand for travel post the Covid-19 pandemic will have already played out," said DB.

As a result, Deutsche lowered its 2022 and 2023 underlying earnings forecasts for the sector by 15% on average and slashed its target prices by 20% on average, with IAG's dropping to 155.0p from 220.0p and Wizz Air's target being cut from 5,450.0p to 2,900.0p.

Analysts at Canaccord Genuity raised their target price on mining firm Atlantic Lithium from 60.0p to 70.0p on Thursday after the group announced a 42% increase in mineral resources at its Ewoyaa project in Ghana.

Canaccord Genuity said it had "repeatedly flagged" the potential for geological upside at Ewoyaa and noted that the resource remains open along strike and at depth.

The Canadian bank stated the next phase of the exploration programme, which commenced last week and included around 18,000 metres of drilling, comes as only 13 square kilometres out of a total 560sq km in Atlantic's Ghanian portfolio has been drilled to date - meaning there were several identified pegmatites in the area that remained untested.

"Given Ewoyaa is already fully funded to production, we view the delivery of a positive project feasibility study (expected during Q2) without the immediate need for a subsequent equity raise as a key differentiator for ALL," said the analysts.

"We raise our target price to 70.0p (from 60.0p) based on an average peer multiple of around 1.3x adjusted net asset value, based on a long-term SC6 price estimate of $1,000 per tonne (versus current spot of roughly $5,000 per tonne). Maintain 'speculative buy' rating.

RBC Capital Markets upgraded Rightmove to 'sector perform' from 'underperform' on Thursday, saying it was now more confident in the company's ability to deliver on market expectations, based on its bottom-up average revenue per advertiser analysis.

"We appreciate RMV's market-leading network effects, ongoing product innovation and strong cash generation," RBC said.

"However, we believe this is already reflected in the current share price."

The bank lifted its price target on the shares to 630.0p from 600.0p on higher estimates.