Last month, this European airline began offering its customers flight-to-flight connection, lifting it from its original ‘no-frills’ strategy. Analysts are forecasting double-digit growth for the company over the next five years.
Ryanair Holdings plc (RYAAY)
From DRIP Investor
The airline sector has been in the news lately, and not in a good way. PR problems at United seem to have impacted the entire group’s image. Still, I can tell you first hand that planes are running at or near capacity (at least the ones I’ve been on in the last several weeks), and I think the summer will shape up as a busy travel season for the airline industry.
Transportation-related stocks have been especially weak since the Dow Transports peaked on March 1, with the Index falling roughly 7% before rebounding. Airline stocks are well off their highs. However, the group offers some interesting opportunities for investors who can look past the current problems.
For more aggressive investors, I like Ryanair (RYAAY), a discount airline based in Ireland. The company’s American Depositary Receipts (ADRs), which trade just like a stock on U.S. stock exchanges, provide an interesting way to play a rebound in economic activity in Europe.
Ryanair shares have broken out following several months of sideways action.
I own the ADRs in one of my brokerage accounts, but you can also purchase shares via the company’s direct-purchase plan. Minimum initial investment is $200. Subsequent investments are a minimum $50.
There is a one-time enrollment fee of $10. Optional purchase fees are $5 plus $0.10 per share. Dividend reinvestment fees are 5% of the amount being reinvested (maximum $5) plus $0.10 per share. Selling fees are $10 plus $0.10 per share. The plan administrator is Computershare/BNY Mellon. To obtain enrollment information call (888) 269-2377 or visit www.computershare.com.
Charles A. Carlson, CFA, DRIP Investor, www.dripinvestor.com, 800-233-5922, May 2017