Qantas Airways Limited (QAN.AX) stock analysis

In our weekly check, Qantas Airways Limited is graded C (A to F). Of 25 checks on debt, profit, cash flow and trend: 15 pass, warnings: 4, red flags: 6.

About Qantas Airways Limited

Qantas Airways Limited is an Industrials company (Airlines, Airports & Air Services) based in Australia, listed on ASX as QAN.AX.

What our checks show for QAN.AX

Red flags

• Net debt is 1.7x a year of EBITDA (debt/equity 6.91). That limits room in a downturn and raises refinancing risk.
• The gross margin fell by 32.9 points, to 19.1%: costs are rising faster than prices.
• Free cash flow is negative (-0.8% of revenue): the business spends more cash than it brings in.
• The stock has fallen as much as 84% from a peak. Would you have held through that?
• Recovering from its deepest fall took about 5.3 years.
• Pay in shares equals 0% of free cash flow: it dilutes shareholders.

Warning signs

• Earnings per share fell 4% a year over the last 3 years.
• Net profit fell 9.6% a year over the last 3 years.
• The net margin is only 5.1%: little room if costs rise.
• The dividend takes 77% of profit: little cushion if profit falls.

Strengths

• The net margin rose by 15 points over 5 years, to 5.1%.
• Operating cash flow is 2.93x net profit: the profit arrives as real cash.
• Analysts expect earnings per share to grow about 18.4% a year over the next years.
• Analysts expect the net margin to improve by 2.3 points from today's 5.1%.
• The price is 10.3 times earnings (P/E), reasonable for its growth.
• Beta 0.63: the stock usually moves less than the market.

Similar companies

AIA.NZ · LTM · PAC · ADP.PA · LHA.DE · LUV

Questions

What grade does Qantas Airways Limited (QAN.AX) have?

In our weekly check, Qantas Airways Limited is graded C (A to F). Of 25 checks on debt, profit, cash flow and trend: 15 pass, warnings: 4, red flags: 6. The grade is a risk check, not a buy or sell recommendation.

What are the main risks of QAN.AX stock?

This week's biggest flags for Qantas Airways Limited: High debt, Gross margin falling, Weak free cash flow. In total 10 of 25 checks show a warning or a red flag.

What does Qantas Airways Limited do?

Qantas Airways Limited is an Industrials company (Airlines, Airports & Air Services) based in Australia, listed on ASX as QAN.AX.

The grade is a risk check, not a price forecast, and not investment advice. In our 10-year test (S&P 500, 2016-2026), stocks we graded A or B fell more than 30% 2-3 times less often than D or F, without a lower average return.

Updated 2026-10-31

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