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Should You Think About Buying Air France-KLM SA (EPA:AF) Now?

Simply Wall St · 5d ago

Air France-KLM SA (EPA:AF), might not be a large cap stock, but it saw a significant share price rise of 33% in the past couple of months on the ENXTPA. The recent rally in share prices has nudged the company in the right direction, though it still falls short of its yearly peak. With many analysts covering the mid-cap stock, we may expect any price-sensitive announcements have already been factored into the stock’s share price. However, could the stock still be trading at a relatively cheap price? Today we will analyse the most recent data on Air France-KLM’s outlook and valuation to see if the opportunity still exists.

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What Is Air France-KLM Worth?

Good news, investors! Air France-KLM is still a bargain right now according to our price multiple model, which compares the company's price-to-earnings ratio to the industry average. We’ve used the price-to-earnings ratio in this instance because there’s not enough visibility to forecast its cash flows. The stock’s ratio of 3.57x is currently well-below the industry average of 6.93x, meaning that it is trading at a cheaper price relative to its peers. What’s more interesting is that, Air France-KLM’s share price is quite volatile, which gives us more chances to buy since the share price could sink lower (or rise higher) in the future. This is based on its high beta, which is a good indicator for how much the stock moves relative to the rest of the market.

Check out our latest analysis for Air France-KLM

Can we expect growth from Air France-KLM?

earnings-and-revenue-growth
ENXTPA:AF Earnings and Revenue Growth January 4th 2026

Future outlook is an important aspect when you’re looking at buying a stock, especially if you are an investor looking for growth in your portfolio. Buying a great company with a robust outlook at a cheap price is always a good investment, so let’s also take a look at the company's future expectations. With profit expected to grow by 56% over the next couple of years, the future seems bright for Air France-KLM. It looks like higher cash flow is on the cards for the stock, which should feed into a higher share valuation.

What This Means For You

Are you a shareholder? Since AF is currently below the industry PE ratio, it may be a great time to accumulate more of your holdings in the stock. With a positive outlook on the horizon, it seems like this growth has not yet been fully factored into the share price. However, there are also other factors such as capital structure to consider, which could explain the current price multiple.

Are you a potential investor? If you’ve been keeping an eye on AF for a while, now might be the time to make a leap. Its prosperous future profit outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy AF. But before you make any investment decisions, consider other factors such as the strength of its balance sheet, in order to make a well-informed assessment.

So while earnings quality is important, it's equally important to consider the risks facing Air France-KLM at this point in time. Every company has risks, and we've spotted 1 warning sign for Air France-KLM you should know about.

If you are no longer interested in Air France-KLM, you can use our free platform to see our list of over 50 other stocks with a high growth potential.