Qantas shares are climbing higher again! Time to buy?

Qantas Airways Ltd (ASX: QAN) shares closed 2% higher on Wednesday afternoon, at $9.14.

The increase marks the third consecutive share price increase in as many days, meaning the ASX airline shares have now rebounded 5% this week.

It’s great news for investors after the travel stock tumbled 19% between early August and mid-September. The shares are now down 13% for the year-to-date and 16% lower than 12 months ago.

What caused Qantas shares to fall in August?

Ahead of the company’s FY26 results announcement in late August, the market hesitated about what the company might post. Some investors began selling their shares, expecting the results to disappoint and the shares to fall again.

And they were right.

In late August, Qantas reported a 13.8% year-on-year decline in its underlying profit before tax, and revealed that its statutory profit had fallen around 29%.

For the 12-month period, Qantas reported a 12.7% year-on-year drop in underlying earnings per share to 96 cents. And elsewhere, its $6.2 billion of net debt came in at the middle of its target range of $5.5 billion to $6.9 billion for FY26.

With profits down, management declared a fully-franked final Qantas dividend of 19.8 cents per share and a total dividend of 39.6 cents per share, down 25% from last year’s final payout.

At the same time, renewed conflict in the Middle East and further oil supply constraints have put pressure back on fuel prices. This has put airlines like Qantas under significant pressure. 

As part of its results, Qantas reported that the impact from the Middle East conflict has cost the airline an estimated $420 million to date, largely driven by higher jet fuel costs.

So, why are the shares climbing higher again now?

There hasn’t been any price-sensitive news out of Qantas this week to explain the latest turnaround in investor interest.

It’s likely that this week’s reprieve in oil prices could be helping to boost the airline’s shares higher. Global travel sentiment is also surprisingly resilient.

Trading Economics shows that crude oil fell back below US$89 per barrel on Wednesday from a high of US$105 per barrel last week, driven by progress in the US-Iran peace agreement.

Is it time to snap up the shares before they climb even higher?

It looks like the experts are confident we’ll see some sort of turnaround story in Qantas shares over the next 12 months.

TradingView data shows that the majority (14 out of 16) have a buy/strong buy rating on the shares. Another two rate the stock as a hold. But they all forecast an upside from the current trading level.

The $11.70 average target price implies a potential 28% upside over the next 12 months, at the time of writing. Even the minimum $10.40 target price implies the shares could jump 14% higher. 

The post Qantas shares are climbing higher again! Time to buy? appeared first on The Motley Fool Australia.

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Motley Fool contributor Samantha Menzies has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.