Ryanair Stock Gains 38.1% in a Year: What Should Investors Do Now?

Shares of European carrier, Ryanair Holdings RYAAY have had a good time on the bourses of late, improving in double digits over the past year. The encouraging price performance resulted in RYAAY outperforming the Zacks Airline industry in the said time frame. Additionally, RYAAY’s price performance is favorable to that of other airline operators like Alaska Air Group, Inc. (ALK) and SkyWest, Inc. (SKYW) in the same timeframe.

RYAAY Stock One-Year Price Comparison

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Given the recent rally, the question that naturally arises is whether RYAAY stock can sustain its bullish price performance or should investors book profits now. Before that, let's delve deep to unearth the reasons behind this northward price movement.

Factors Working in Favor of RYAAY Stock

With travel bookings rising across the industry, Ryanair’s passenger revenues are also increasing. Because of this air-travel demand strength, RYAAY's traffic grew 9% to 183.7 million passengers in fiscal 2024. Further, we would like to remind investors that Ryanair carried 200.2 million passengers (traffic up 9% year over year) in its fiscal year ending March 2025, positioning itself as the first European airline to reach 200 million passengers in a single year. As a result, RYAAY is now the world’s leading low-fare airline in terms of passenger traffic, with low fares and reduced costs acting as the main catalyst. During the first nine months of fiscal 2026, RYAAY’s traffic grew 4% year over year to 166.5 million passengers.

Given the aforesaid encouraging backdrops, Ryanair has unveiled its raised traffic outlook for fiscal 2026 (concurrent with its third-quarter fiscal 2026 earnings release on Jan. 26, 2026). RYAAY now anticipates its fiscal 2026 traffic to grow by 4% to almost 208 million passengers (prior view: 207 million), owing to solid demand and earlier than expected Boeing BA deliveries.

Ryanair’s fleet-modernization initiatives to cater to the improvement in travel demand are encouraging. The inclusion of modern planes in its fleet and the retirement of the old ones align with its environmentally friendly approach. By the end of December 2025, 206 of the 210 Boeing 737-8200 aircraft (to be purchased under the 2014 contract) had been delivered. The remaining 4 aircraft are expected to be delivered by the end of February 2026, which encourages the company to expect 4% traffic growth to 216 million passengers during fiscal 2027. In May 2023, 300 new Boeing 737-MAX-10 aircraft orders were placed for delivery between 2027 and 2033. Ryanair expects these fuel-efficient MAX jets to generate substantial growth.

RYAAY has a solid balance sheet. The low-cost carrier ended the third-quarter fiscal 2026 with cash and cash equivalents of $2.85 billion, much higher than the current debt level of $1.40 billion. This implies that the company has sufficient cash to meet its current debt obligations. RYAAY's efforts to repay its debts are encouraging as well. As of Dec. 31, 2025, RYAAY made €1.2 billion in debt repayments.

Long-Term Debt to Capitalization

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RYAAY is also active on the share buyback front. During fiscal 2025, Ryanair purchased and canceled 7% of its issued share capital, comprising more than 77 million shares, and has now retired almost 36% of its issued share capital since 2008. In April 2025, RYAAY repurchased almost 1 million shares, completing the €800 million share buyback program. In May 2025, RYAAY’s board approved a follow-on €750 million share buyback program. As of Dec. 31, 2025, RYAAY had purchased (and cancelled) more than 13.1 million shares (almost 25% of the programme) at a cost of €340 million.

Headwinds Weighing on RYAAY Stock

Production delays at Boeing have been hurting the fleet-related plans of most airline companies, and it is no different for RYAAY. The company is actively in talks with Boeing leadership to speed up aircraft deliveries and has also visited Seattle at the beginning of January. Although B737 production is recovering from Boeing’s strike in late 2024, but still slow to deliver sufficient aircraft ahead of the summer season of fiscal 2026. RYAAY anticipates the remaining 4 Gamechangers of the 210 orderbook are likely to be delivered by the end of February 2026. Additionally, Boeing expects the MAX-10 to be certified in mid-2026, followed by the delivery of the first 15 MAX-10s in Spring 2027 (with 300 of these fuel-efficient aircraft delivery due by March 2034).

Escalating operating expenses due to high staff costs and higher air traffic control fees are hurting Ryanair’s bottom line. During the first nine months of fiscal 2026, staff costs increased 4% year over year due to higher sectors and agreed pay increases. Airport and handling charges rose 5% year over year owing to traffic growth, higher landing, ground air traffic control, and handling rates. As a result, total operating expenses grew 6% year over year, owing to higher staff and other costs, which were in part due to Boeing delivery delays. This was partially offset by fuel hedge savings. High costs naturally put pressure on margins.

Given these headwinds surrounding the stock, earnings estimates have been southbound for the fourth quarter of fiscal 2026, as shown below.

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Wrapping Up

It is understood that RYAAY's top line continues to benefit from the resurgent travel scenario. The company’s raised traffic outlook for fiscal 2026 is an encouraging move, which is likely to impress investors. RYAAY’s measures to expand its fleet, to cater to the rising travel demand, look encouraging. A solid balance sheet allows RYAAY to reward its shareholders in the form of share buybacks and dividend payments. Despite these positives, we advise investors not to buy RYAAY shares now due to headwinds like the production delays at Boeing, high staff costs and escalated air traffic control fees.

We advise investors to wait for a better entry point. For those who already own the stock, it will be prudent to stay invested. The company’s current Zacks Rank #3 (Hold) justifies our analysis. You can see .

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