Deutsche Lufthansa Stock: Barclays Downgrades Amid Transatlantic Concerns

Deutsche Lufthansa shares tumbled significantly on Wednesday following a substantial downgrade by Barclays Investment Bank. The British financial institution cut its rating from "Overweight" to "Underweight" in a double downgrade that slashed the target price from €10.50 to €6.50. This pessimistic reassessment triggered a sharp decline, with shares falling as much as 5% to €7.40 during XETRA trading. Analyst concerns primarily center on Lufthansa's crucial North Atlantic routes, characterized by one expert as "the golden goose being cooked." This segment has been vital to the airline's profitability, with Barclays noting that well over half of European flag carriers' operating profits derive from transatlantic operations. The current share price remains approximately 39% above its 52-week low reached in August 2024, but requires more than 9% growth to regain its recent high of €8.16.

Profit Forecasts Significantly Reduced

Barclays has dramatically revised Lufthansa's 2025 profit estimates downward by 36%. While analysts maintain that North Atlantic markets remain structurally strong and will continue generating profits for Lufthansa this year, they now anticipate substantially lower margins than previously forecast. This reassessment follows profit warnings from major American carriers including Delta, American, and United Airlines, which Barclays interprets as signaling a meaningful trend shift. Despite current market pressures, notable insider activity occurred when Lufthansa's CEO purchased company shares worth approximately €72,760 at an average price of €7.62 in March 2025, potentially indicating long-term confidence in the airline's prospects.