International Consolidated Airlines: Hedging Provides Cushion Amid Oil Shock, We Still See Upside

With ~62% of fuel hedged, IAG is better protected than US peers, limiting near-term margin pressure even as oil approaches $100/bbl. Premium leisure and corporate demand remain robust, while limited Middle East exposure and LatAm resilience provide relative stability versus other regions. Even factoring in €500 million potential fuel headwinds, we see a 16% upside. A strong balance sheet and FCF generation also support this.