IAG share price braces for turbulence ahead of Q3 earnings

IAG (LON: IAG) share price will be in the spotlight this week as the FTSE 100 constituent is scheduled to publish its quarterly and annual results. The stock has made a strong recovery phase having jumped from a low of 90.82p in December to 167.66, ~88% jump. 

IAG earnings preview

The FTSE 100 earnings calendar will be relatively busy this week as most constituent companies are expected to publish their results. Some of the top names to watch are companies like Rio Tinto, Rolls-Royce Holdings, HSBC Bank, Lloyds, and BAE Systems among others.

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IAG, the parent company of British Airways, will publish its Q4 and full-year results on Friday. These results are expected to show that the company’s revenue rose while losses narrowed.

The median estimate from 25 analysts is that the company’s operating income came in at 457 million euros in the fourth quarter. For the full year, they expect that its consensus earnings was over 1.19 billion euros.

Recent results from other airline companies back the bullish case for IAG. In the United States, airlines like Delta and United published strong results. Southwest’s earnings disappointed after the company’s travel disruptions in December.

The same outlook happened in Europe, where companies like EasyJet, Ryanair, and Wizz Air published strong results, as I wrote here. As a sign of the strong performance in the industry, Air India recently made a big order of over 400 planes. 

IAG will likely deliver good forward guidance because of China’s reopening. British Airways, unlike EasyJet and other regional airlines, has a strong exposure to the Chinese market. 

In its most recent results, IAG said that its operating profit for Q3 came in at 1.2 billion euros after a big 452 million euros in the previous year. Its profit after tax came in at 199 million euros as its cash jumped to 9.26 billion euros.

IAG share price forecast

IAG stock chart by TradingView

International Consolidated stock price has made a strong recovery in the past few months. As it rose, it moved above the upper side of the descending channel shown in blue. It has crossed the 100-day and 50-day moving averages and is at the 23.6% Fibonacci Retracement level. 

Further, the shares have formed an inverted head and shoulders pattern. Therefore, the stock will likely continue rising as buyers target the key resistance point at 230p. This view will be confirmed if it moves above the key resistance point at 180p (7 Feb high).