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When looking at some of the biggest main market losers in 2026 so far, easyJet (LSE: EZJ) shares undoubtedly stand out. But could now actually be a wonderful chance to pick up a slice of the budget airline?
Worse than expected
You don’t need to be Warren Buffet to understand why the Luton-based business is finding things so tough. The US-Iran conflict has pushed fuel prices skyward. Given that easyJet will have been gearing itself for the busiest time of its financial year, the timing couldn’t have been worse.
Based on the reaction, yesterday’s trading update was even more dire than the market had been expecting. CEO Kenton Jarvis and his team anticipate reporting a pre-tax loss of £540m-£560m for the first half of the financial year.
No wonder shares have now fallen almost 28% in 2026 alone.
This dramatic fall might be slightly easier for existing investors to take if other aviation stocks were suffering to a similar extent. But this isn’t the case. British Airways owner IAG, for example, is down ‘only’ 8% from where it stood at the beginning of 2026.
In sharp contrast, a stake of £10,000 invested in easyJet as markets opened up in January would now be worth roughly £7,200. There was 13.2p per share dividend paid at the end of March but that’s hardly likely to soothe the pain.
Reasons to consider easyJet shares today
As tough as the last few months have been, there’s an argument that new investors would be getting a great deal today.
A price-to-earnings (P/E) ratio of seven is certainly low (albeit IAG is still slightly cheaper). It suggests a lot of bad news is already priced in. With net cash of £434 million at the end of March, the balance sheet doesn’t look stressed either.
The company’s clearly popular with flyers too. The load factor in the first half rose to 90% and customer numbers for easyJet holidays climbed 22%. It also saw it’s “busiest Easter holiday period ever”.
Based on all this, I think the income stream looks safe. But the question is whether these things are enough to convince investors that this isn’t a value trap disguised as a beautiful bargain.
Feeling lucky?
I’m not sure it is. The way ‘negotiations’ are proceeding between the US and Iran, easyJet shares might continue to lose height in the weeks ahead. Indeed, the fact that the company’s currently receiving considerable interest from short sellers isn’t the best sign.
One thing I’m keeping in mind however, is that this isn’t anything to do with the company per se. So if there is a resolution of sorts, I think it’s perfectly possible that easyJet could recover. We know its shown itself able to navigate its way through tough times before, including the monumental shock to the system that was Covid-19.
But this feels like a binary bet, at least for now. And that doesn’t strike me as the sort of ‘investing’ I want to get involved in. As a Fool, I’m looking to grow my wealth steadily over the long term rather than take on extra risk.
I reckon there are far better opportunities for me to make money elsewhere.
The post £10,000 invested in easyJet shares at the start of 2026 is now worth⦠appeared first on The Motley Fool UK.
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Paul Summers has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.
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