WizzAir and TUI under pressure 📉

Wizz Air (WIZZ.UK)

• Low-cost airlines are burdened by the risk of an economic slowdown and the resulting lower demand from a market that prefers 'budget' air transportation. Shares are losing 7.5% today;
• In the UK, airlines were recently forced to cancel flights from London's Heathrow and Stansted airports, among others, due to severe weather conditions; to date, weather in the UK has been a problem for air transportation;
• December 13, Tuesday insider Jozef Vazsardi sold nearly 82,234 shares worth GBP2 million at GBP24.12 per share. Wizz Air announced the cancellation and more than a dozen air routes from Poland. It is still unclear how many connections in 2023 will be created.  

TUI (TUI.UK)

• The travel agency's shares fell as the company announced a rights issue to repay €730.1 million and interest to the German government, for assistance given to the company during the coronavirus pandemic. In a statement, Tui said it would repay the debt, granted through the government's Economic Stabilization Fund (WSF), by the end of 2023. As a result, the company's shares are down more than 7% today;
• Morgan Stanley analysts estimate that Tui's total debt repayment financing could be worth between €1.5 billion and €1.9 billion, representing as much as 60% of Tui's market capitalization. The analysts warned in a note to clients that this could lead to an "overhang" on Tui shares.
• TUI CEO Sebastian Ebel argued in a statement that the company has "overcome the crisis," although much additional work lies ahead: "Of course, we still have homework to do as a consequence of the pandemic, further cutting our debt, refinancing, strengthening our balance sheet."
• In its financial report released today, Tui reported revenues for the fiscal year ended September 30 at €16.5 billion, close to pre-pandemic levels. Earnings before interest and tax also returned to 2021 levels, rising to €409 million compared to a €2 billion loss last year. The company said it expects significant EBIT growth in 2023. 

Chart of TUI,(TUI.DE), MN interval. TUI's share price is near levels seen only three times in the past two decades, in 2008, 2010 and 2020. Source: xStation5