IAG Shares Soar 130% in a Year, Are They Worth Buying Now?

International Airlines Group (IAG) shares have risen 130% in the past year, boosted by double-digit profit gains and increased revenue. Analysts say IAG shares remain undervalued by investors, with revenue expected to rise to €33.6billion in 2024 and €34.8billion in 2025. Despite tentative rumblings of potential turbulence ahead, IAG's performance is positive, driven by favourable pricing and cost efficiencies.

International Airlines Group (IAG) shares have experienced a remarkable 130% increase over the past year, driven by double-digit profit gains and significant revenue growth. The company's robust performance has been bolstered by favorable pricing and cost efficiencies, according to analysts. Despite some concerns about potential turbulence ahead, IAG's financial results remain promising.

IAG's second-quarter corporate volume declined by nearly 8% year-over-year, but its corporate revenue decreased by only about 1% [1]. This discrepancy can be attributed to the impact of tariffs on North American points of sale and the timing of Easter, which fell within the second quarter [1]. However, British Airways reported a flat corporate revenue for the first six months of 2025, indicating a recovery in the North Atlantic region [1].

Latin American markets have been a strong performer for IAG. Iberia CEO Marco Sansavini noted that corporate revenues and volumes in this region are performing exceptionally well, with revenues up 8% year-over-year and 38% compared to 2019 [1]. This positive trend is expected to continue, with IAG maintaining its focus on these core markets.

IAG's financial results for the second quarter of 2025 were impressive. The group reported a passenger revenue of nearly €7.8 billion, a 4.9% increase year-over-year, and total revenue of about €8.9 billion, up 6.8% from the previous year [1]. Net income before taxes reached €1.5 billion, a significant improvement from the €1.1 billion reported in Q2 2024. Despite the challenges faced, IAG's capacity increased by 2.2% year-over-year, while the load factor fell to 85.4%, indicating a balanced approach to growth [1].

CNA Financial Corporation, a significant player in the insurance industry, also reported strong financial results for the second quarter of 2025. The company's net income was $299 million, up 3% year-over-year, while core income increased by 3% to $335 million [2]. The P&C segments generated gross written premium growth of 5% and net written premium growth of 6%, reflecting improved underwriting results. Despite a significant after-tax charge related to legacy mass tort, the company's financial performance remains robust.

Analysts remain optimistic about IAG's prospects. They expect the company's revenue to rise to €33.6 billion in 2024 and €34.8 billion in 2025, suggesting that the company is well-positioned to continue its growth trajectory [1]. However, investors should remain vigilant about potential challenges, such as geopolitical uncertainties and fluctuations in the cost of sustainable aviation fuel.

References:
[1] https://www.businesstravelnews.com/Transportation/Air/IAG-Q2-Corp-Volume-Revenue-Down
[2] https://www.prnewswire.com/news-releases/cna-financial-announces-second-quarter-2025-net-income-of-1-10-per-share-and-core-income-of-1-23-per-share-302520006.html