Buy Lufthansa shares or not? Our future forecast 2022!

Mark Norgate
October 6, 2021
Buy Lufthansa shares or not Our future forecast 2021!

Lufthansa is the second largest provider of air transport in Europe, and almost every European has already travelled at least once on a Lufthansa Group flight.

The fleet of more than 200 aircraft transports more than 130 million people to their desired destinations every year in comfort.

In the years up to 2019, Lufthansa regularly increased its profit and raised the dividend for its investors. However, the events in 2020 pushed the price down again. Therefore, we want to determine whether and to what extent the Lufthansa share can make a comeback in 2021.

The chances of a course jump are suitable as soon as all restrictions are lifted!

That means now could be the right time to invest!

Table of Contents

Buying Lufthansa shares – what should you watch out for?

You should pay attention to the following points when buying Lufthansa shares:

  • Why should you invest in Lufthansa shares? Lufthansa is the leading provider of air travel and is known worldwide with the crane symbol. Despite the current situation, the airline is secure thanks to state participation and can start after the crisis.
  • Where can you buy Lufthansa shares? In principle, Lufthansa shares can be purchased from any online broker. However, we recommend our test winner broker Capixal. With the one-time offer to pay no fees on purchase and sale, no additional costs reduce the return.
  • What can the future of Lufthansa shares look like? The airline had to give up due to flight bans and border closings, but the share could pick up speed again as soon as the pandemic was over. With vaccinations and rapid tests, a successful restart is within reach.

Where and how to buy Lufthansa shares Best brokers in comparison:

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Buy Lufthansa shares in 3 steps: Our guide

Lufthansa is one of the best-known companies in the German share index.

Mainly because the company is the twelfth largest operator (by the number of passengers) in the global air travel industry, it has enormous brand value.

It is also noteworthy that, unlike many of its competitors, the airline is not constantly struggling with red numbers and can ultimately only barely stay “afloat”, but has made billions in profits.

After the state participation, more users than ever are asking themselves: Where to buy Lufthansa shares right now?

1. Registration with a broker

To be able to buy the Lufthansa share, you first have to register with a broker. It is advisable to pay particular attention to deposit protection because the shares will still belong to you if the broker goes bankrupt. Anyone who waives this deposit protection will be left without shares in the event of the broker’s bankruptcy.

If stock selection and evaluation are too complicated, a social trading platform can also be a good solution. Here you simply follow an experienced trader and automatically copy the trader’s trading decisions.

Our broker recommendation at this point is Capixal – with state-guaranteed deposit protection of up to 20,000 euros and 0% commission when buying shares, Capixal is our test winner broker. To register with Capixal, click here.

If you have decided on a broker, you log in with your data and verify your email address and any other data.

Capixal

2. First deposit

After registering, you need to decide how much to invest in stocks. We generally recommend that you never invest more than 5% of your capital in a single share.

Once you have decided on the amount you want to invest, click on the ” Add Money ” button after registering with Capixal.

You can now choose from various deposit methods, including PayPal, credit card or bank transfer.

Below is an overview of all the payment methods available at Capixal:

Payment optionPossible?
Buy Lufthansa shares with a credit card✔️
Buy Lufthansa shares with PayPal✔️
Buy Lufthansa shares with Skrill✔️
Buy Lufthansa shares with a bank transfer✔️
Buy Lufthansa shares with Neteller✔️
Buy Lufthansa shares with UnionPay✔️

3. Buy Lufthansa shares online

After the deposit, the money appears in your account under the menu item “Account”.

First, search for the Lufthansa share in the search bar above and click on the ” Trade ” button.

A small window will open (see screenshot) in which you can set the price and the number of shares you want to buy. You can also set stop loss and take profit, i.e. at which price the share should be sold again in the event of a profit or loss. The two fields are optional.

The Leverage field allows you to control whether you want to buy the real share (x1 leverage) or a CFD (x2 or more leverage).

With a click on ” Place order ” the purchase is completed, and the share appears in your portfolio.

Lufthansa share price, price & key figures

Currently (February 18, 2021), the value of the Lufthansa share is far behind at around € 11.

In the technical analysis, the share is currently in a resistance zone between 11 and 12.50 euros. If this zone is broken, that would be a strong positive signal for the future of Lufthansa, and the way would be open for price targets at the pre-crisis level of 15 to € 18 per share.

The Frankfurt analysis company Kepler Cheuvreux sees the airline as a “BUY” candidate and has set its price target for the Lufthansa share at € 12.70 given the easing of the situation towards summer 2021. However, other analyst firms see the situation rather negatively: The average target price they advertise for the share is only around 6 euros.

While analyst estimates should never be seen as a guarantee, they are a good indicator of the future development of a company and give an outlook on profit development in normal operations after the crisis.

In the past few years, the passenger transport business has boomed, and the record number of trips had a positive impact on the stock. If you compare the Lufthansa share pros and cons, the booming aviation business is a very clear pro argument.

Overall, the airline industry seems to be facing particularly profitable times. Because while people like to travel in Europe and the attraction of flying is gaining in importance year after year, other nations and continents are currently in a real spirit of optimism in terms of travel technology.

This applies above all to Asia, Africa and South America, which, thanks to increasing affluence, are using airlines more and more often. This should be included in a forecast for the Lufthansa share.

Both the number of passengers and the number of flights per traveller per year are increasing. Statisticians predict that international flights will practically double to around 7.8 billion flights by 2036. For Lufthansa, there is a particular focus on Asia as an up-and-coming market that will grow even faster in the future than it is today.

Buy Lufthansa shares or not Our future forecast 2021!

Lufthansa share key figures

After the reports about the sale of the catering rail and the dismissal of 29,000 employees in 2020, one must admit that the pandemic has also hit Lufthansa heavily.

The chances are still good that a comeback is possible. The vaccines from international manufacturers are in use, and it is only a matter of time before we can fly again and the global situation relaxes. Lufthansa is an enduring company and ready to meet the steadily growing global demand when the time comes.

Lufthansa share price targets

The price target of the Lufthansa share fluctuates strongly. Some analysts see a long-term optimistic future and set the price target at € 13. On the other hand, there are less optimistic contemporaries on the way.

Citigroup, for example, sees a complete decline in the share and leaves the price target at less than one euro. On the other hand, Morgan Stanley sets the price target at € 5, so expects the share value to halve.

The average expectations of the analysts are currently (February 18, 2021) at EUR 6.14 per share

Lufthansa share dividend 2021

YearDividend in EURDividend yield
2022e0.00 **0% **
2021e0.00 **0% **
20200.000%
20190.804.08%
20180.240.92%
20170.503.04%
20160.503.63%

At the Annual General Meeting on May 5, 2020, Lufthansa decided to completely suspend dividend payments until the stabilisation measures, i.e. until 2023. Other airlines have also cut or radically reduced their dividends for the coming years.

However, the past data (2014-2019) generally show a rising dividend and an average dividend yield of around 3% per subscribed share. From 2014 to 2019, the group increased the dividend by approx. 12% in each case compared to the previous year.

This trend could not continue due to the air traffic restrictions. Still, it shows that the Lufthansa company can basically operate profitably and is an indication that profits and dividends will rise again after the pandemic.

Lufthansa shares – buy or sell? Advantages and disadvantages
  • Long tradition
  • Large fleet of aircraft
  • Largest flight operator 
  • Outstanding infrastructure with technology and maintenance hangars
  • Improvement through vaccinations and rapid tests
  • Problems in the aviation industry
  • Difficulty due to increasing political requirements
  • Strong competition from so-called low-cost airlines

Buy Lufthansa shares or not Our future forecast 2021!

Lufthansa share: arguments to buy the Lufthansa share

The Lufthansa share may well be one to buy for investors’ profits represent. Although less risk-taking investors are interested in the share, buying Lufthansa shares is more interesting for more conservative investors. Thereoperate profitably and indicatesare several arguments in favour of at least a moderate increase in value.

Lufthansa has lost several competitors in recent years. One of these ex-competitors was the comparatively small airline “Germania”, which with air traffic of 4 million people per year does not even come close to the volume of Lufthansa. Nevertheless, one can assume that Lufthansa can take over at least part of the flight volume. Therefore, the Lufthansa share investment can currently make sense because even an increase of around 3 to 4 million flights per year could trigger a significant jump in the share price.

The strongest argument in the long term is the strong demand for air travel from private individuals.

This is precisely why one should consider investing in Lufthansa shares: Air traffic is increasing year after year. Lufthansa is the largest air transport company in terms of the number of passengers transported annually. As a result, the future looks extremely positive for the company’s shareholders.

In the medium term, the influx of new passengers is expected to increase very sharply. There are currently around 4 billion passengers a year. In 2036, primarily thanks to new prosperity in emerging countries, developing countries and industrialised nations, there should be a total of 7.8 billion people. Because Lufthansa has enormous market dominance in Europe, a Lufthansa share investment makes double sense in this context.

High profits despite a wave of investment

The Lufthansa profits before the crisis are very high. This also resulted in high earnings per Lufthansa share.

Lufthansa generated a profit of 3 billion euros from its operating business in 2017. That is 70 per cent more than in 2016 – a record profit. 

Lufthansa’s capital expenditure in recent years,  large sums of money into the expansion of its air fleet. This also had an impact on the Lufthansa share price. In the first half of 2018, the company invested around 1.9 billion euros in expanding and improving its aircraft regiment – 40 per cent more than in 2017. However, the high expenditures then decreased in 2019. As a result, at the end of the quarter and More money left over the year and profits rose, a profit in the Lufthansa share was foreseeable. At the same time, the market dominance of the global player Lufthansa increased again, which now has even more influence on the Pricing in South African air traffic.

Before the crisis, the Lufthansa share dividend was 0.80 euros per year and thus offered its shareholders a dividend yield of 4.08% in 2019. Thus, the Lufthansa share dividend distributed was relatively strong for a DAX company and should rise constantly. It was initially planned to pay out € 0.98 per share in 2020, but nothing came of it due to the slump in global aviation.

Due to the pandemic, there will be no dividend payments in the short term, but at the same time, this is an excellent chance to buy Lufthansa shares cheaply to achieve a superiorThereforeidend yield in the long term. Most likely, the company will pay a good dividend again in a few years and keep increasing it.

Sell ​​Lufthansa shares? Sell ​​arguments

Lufthansa is currently in bad shape. Therefore, while many shareholders are presently watching the Lufthansa share price with interest and some experts are expecting a moderate bull run, in no case do all the factors speak for a rapid rise in the Lufthansa share price.

Specifically, there are the following counter-arguments that do not speak in favour of buying Lufthansa shares:

Compared to 2016, raw materials are not exactly cheap. Currently, a gallon of kerosene costs about $ 1.40. In 2016 it was $ 0.97. So although the prices for kerosene are still relatively low, it still costs the airline more than it did a few years ago.

Lufthansa has calculated the costs for 2019 transparently: 200 million euros more than in 2018 were paid for kerosene. At the beginning of 2019, the company assumed additional costs of 900 million euros. Although the charges were not as high as expected, the kerosene price factor still hurts Lufthansa share earnings.

Overheated euphoria can be counterproductive

Excessive euphoria could hurt the Lufthansa share key figures because Lufthansa is by no means looking to take over the bankrupt airline.

It should also be noted that an airline with only 34 jets and four million flights per year did not have as many slots available as was the case with AirBerlin, for example. Even if Lufthansa takes over all the slots that have become free, that is not an enormous number, given around four million flights a year compared to more than 130 million passengers transported per year. A bull run on Lufthansa triggered by mass psychology can quickly turn into the opposite and push the share value down.

State aid could become a problem for Lufthansa

Due to global flight bans, quarantine measures and falling passenger numbers in general, the company has come under so much pressure that even a state stake of 20% was approved.

The question of how and, above all, when the state will withdraw from the company has not yet been settled. Although, this gives the share specific basic stability. It could quickly turn negative in the event of a wrong exit.

Even if Lufthansa has only called on a third of the aid package, the state’s participation is controversial. Competitors such as Condor have already announced lawsuits or are already actively suing Lufthansa.

Condor has brought proceedings against Lufthansa at the Federal Cartel Office and accuses the company of abusing its market power and unfairly disadvantaging competitors by distorting competition. However, the plaintiffs do not go far enough in connection with the federal aid package.

This procedure and ongoing problems and disputes with consumer protection in connection with ticket refunds could harm Lufthansa shares in the future.

Investing in Lufthansa shares – yes or no?

Suppose you look at the Lufthansa share key figures. In that case, the Lufthansa share forecast by experts and the pro arguments listed here, a rather pessimistic mood emerges for the airline in the medium term.

In the Lufthansa share pros and cons, despite the light at the end of the tunnel, the contra arguments currently still predominate. However, one must remember that it is in the Lufthansa shares to classic “blue chip” shares, in its longevity and stability comparable to other traditional companies such as Volkswagen or Porsche.

Even if aviation is currently in a crisis and is unlikely to recover until the end of the pandemic, people will want to fly again in a few years. With venture capital, joining Lufthansa could still be worthwhile in the long term, especially when you consider that millions of people board a plane for the first time every year.

The freed-up slots of Germania Airline, the general profit rate of the quarters before 2020, and the role as the second-largest air traffic operator in Europe and the progress concerning vaccinations make Lufthansa a company that should be watched shortly. Therefore, future development could be exciting.

Buy Lufthansa shares or not Our future forecast 2021!

Lufthansa shares news & history

Lufthansa is a traditional company that can look back on almost 100 years of activity in the aviation industry.

The Lufthansa share history is shorter but still remarkable. While Lufthansa did not exist on the market from 1945 to 1953, the company opened its doors again in 1953.

Thanks to the modern economy and advanced aircraft technology, the company quickly established itself at the forefront of the aviation business. Over the past few decades, the company has expanded again and again and enlarged its aviation fleet. As you can guess, this has led to a turbulent but awe-inspiring Lufthansa share story. The company has only been 100 per cent privatised since 1997.

Lufthansa is active worldwide. Air traffic occurs primarily in Europe, but North America and Asia and the Pacific region are often destinations for pilots at Lufthansa. However, the strong diversification of the company is also noteworthy.

While around three-quarters of sales are generated by passenger transport, the company is also active in other areas. This is, for example, the freight traffic in which the group is active under the name “Lufthansa Cargo”. Here, destinations in Asia / Pacific accounted for almost 50 per cent of sales. Lufthansa Cargo’s share of the Group’s total revenue is increasing, mainly through cooperation with Asian companies.

Lufthansa share forecast 2021

Lufthansa is facing an interesting financial year, so Lufthansa’s forecast is very uncertain. However, while the prices for kerosene were not as high as expected, one can assume that there will be a large amount of air traffic in the coming years. As a result, the number of people who want to travel regularly will rise again, and the global giant Lufthansa will also benefit from this.

With the elimination of the competitor, which managed four million trips in 2018, the market is opening up a little further than before. As a result, the likelihood that Lufthansa, as the most significant global player, will get a piece here or even take over all the slots that have become free is very high.

Because other divisions of the company are also growing, you can listen to optimistic forecasts. This applies, for example, to the freight traffic of Lufthansa, which operates under the title “Lufthansa Cargo”, and to activities in the technology sector.

For example, the company cooperates with technical companies and renews and repairs aircraft from competing airlines. The great know-how and decades of experience make Lufthansa one of the most interesting companies. 

Lufthansa vs other airline stocks

United Airlines share

  • Big competitor in the international market
  • Significantly higher market capitalisation
  • The bottom seems to have already been passed 
  • Uncertain prospects
  • Little international importance
  • Currently dependent on government aid

KLM Royal Dutch share

  • Oldest airline in the world
  • Great competition with Lufthansa on the European market
  • Supported by the state
  • Extensive international route network
  • Uncertain future prospects
  • Extreme price fluctuations even without Corona
  • Fleet greatly reduced

Wizz Air share

  • Strong growth
  • Inexpensive flight provider
  • Benefit from short-haul slots
  • European destinations only
  • Often bad press
  • Tiny fleet
  • Bad customer service

Fees when buying Lufthansa shares

We compare the fees of the largest brokers with the following example:

  • Purchase of Lufthansa shares with a value of € 1,000
  • Hold the Lufthansa share for one month and then sell
  • No course changes in the 30 days

With these assumptions, we now compare the fees of Libertex, Capixal & Plus500 :

providersLibertexCapixalPlus500
Depositfor freefreefor free
Purchase fees€ 2.20free3.08%
Holding feesfor freefree0.05%
Sales charges€ 2.20spreads3.08%
Total fees€ 4.40Reasonable € 92.32

Buying Lufthansa shares: Our conclusion

A degree of risk capital could be the entry into the company in the long term pay off because even if the organisation has suffered the full year 2020 and had to step in even the state is Lufthansa overall solid posgainition for the future and growing demand for long-distance travel as soon as the pandemic overcome seems quite likely.

If you want to invest in Lufthansa, you can do that easily via numerous online brokers and platforms. The benefits are obvious here. Registration is quick, the payment methods are easy to understand, and how to buy Lufthansa shares is understandable and suitable for beginners.

In our opinion, the best broker to participate in the development of Lufthansa is Capixal – through social trading, i.e. the automatic following of the decisions of experienced traders

You don’t have to pay attention to the latest news constantly but can leave that to those who own the Lufthansa share that has been acting for years. In addition, there is a state-guaranteed deposit guarantee of up to 20,000 euros and 0% commission when purchasing Lufthansa shares.

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FAQs

At the moment, the price is cheap to get into the airline with a little risk capital!

Lufthansa pays dividends to its shareholders on a regular basis. The planning for 2020 was 0.98 euros per dividend, for 2022 1.07 euros per share.

in the article, some ways are presented how you can quickly get hold of your own Lufthansa share. If you do not want to purchase the share directly, you also have the option of using CFDs to bet on rising or falling prices.

Lufthansa is listed on the DAX. Here the company is one of the strongest and most ambitious companies in recent years.

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