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1. Company Snapshot

1.a. Company Description

Norwegian Air Shuttle ASA, together with its subsidiaries, provides scheduled and charter airline services in Norway and internationally.As of December 31, 2021, the company operated a fleet of 70 aircraft.It is also involved in aircraft financing, leasing, and ownership activities; and cargo activities.


Norwegian Air Shuttle ASA was founded in 1993 and is headquartered in Fornebu, Norway.

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1.b. Last Insights on NAS

Norwegian Air Shuttle ASA faced headwinds in recent months due to renewed trade and geopolitical uncertainties, which have impacted European markets. The company's operations are likely affected by the volatility in the eurozone, where business activity, although positive, is subject to fluctuations. Furthermore, the airline industry is particularly sensitive to external factors such as fuel prices and regulatory changes. A recent downgrade by rating agencies or cautious investor sentiment may also weigh on the company's short-term prospects.

1.c. Company Highlights

2. Norwegian's Q4 2025 Earnings: A Strong Finish to the Year

Norwegian's fourth-quarter 2025 financial performance was marked by a 4% increase in revenues to NOK 8.5 billion, driven by robust traffic figures and higher unit revenue. The quarterly operating result improved to NOK 21 million, up from a negative figure last year. The company's EBIT margin reached 9.9%, a historically strong figure. Earnings per share (EPS) came in at '-0.01518', beating estimates of '-0.02984'. The full-year result showed earnings before tax of NOK 3.016 billion, with an EBIT margin of 9.9%. As Hans-Joergen Wibstad, CFO, presented, Widerøe contributed significantly to the result, with an EBIT of NOK 528 million before tax.

Publication Date: Mar -02

📋 Highlights
  • Profitability Surge:: EBIT reached NOK 21 million in Q4 2025 (up from -NOK 93 million YOY), with a 21% earnings increase and a record EBIT margin of 9.9%.
  • Network & Customer Growth:: Expanded to nearly 500 routes by 2026, achieving an NPS score jump to 50.1 from 38.5, reflecting strong customer loyalty.
  • Financial Stability:: Repaid debt, eliminated a convertible bond, and maintained NOK 10.1 billion liquidity with an 18.2% equity ratio, enabling a NOK 0.8 dividend (33% higher than 2024).
  • Cost Management:: Achieved flat CASK in 2025, stable fuel costs, and a 4% revenue rise to NOK 8.5 billion, despite 3% fleet growth and 13 new aircraft acquisitions.
  • Widerøe Contribution:: Generated NOK 528 million EBIT pre-tax in 2025, with PSO route subsidies driving 50% ticket price reductions and improved network alignment in 2026.

Revenue Growth and Cost Management

The company's revenues for Norwegian increased from NOK 6.4 billion to NOK 6.6 billion in the fourth quarter, driven by lower CASK and higher yields. Personnel costs expenses increased due to salary increases, but aviation fuel costs remained stable. Geir Karlsen mentioned that the recent weakening of the U.S. dollar has a significant impact on the company's cost base, stating, "We're hedged at 20-25%, but if the dollar continues to weaken, this could positively impact our CASK and cost level in 2026."

Valuation and Dividend

With a P/E Ratio of 6.11 and a P/S Ratio of 0.45, the market seems to have a reasonable expectation of the company's future performance. The Dividend Yield stands at 5.73%, indicating an attractive return for investors. The company's ROE is 39.51%, suggesting a strong return on equity. The Net Debt / EBITDA ratio is 2.91, indicating a manageable debt level.

Outlook and Guidance

Looking ahead, the company is optimistic about the future, with a strong financial position and a loyal customer base. The new distribution platform and interlining capabilities will also provide opportunities for growth. Analysts estimate next year's revenue growth at 5.2%. The company's fleet growth is expected to be 3% for 2026, with a low single-digit percentage increase in unit costs. The company is guiding for more than NOK 1.25 billion in profitability improvement from Program X.

Balance Sheet and Liquidity

The company cleaned up its balance sheet in 2025, repaying corporate debt, eliminating a convertible bond, and acquiring 13 aircraft. The liquidity position stood at NOK 10.1 billion, with an equity ratio of 18.2%. The balance sheet remained in a good position, with total assets unchanged from the previous quarter.

3. NewsRoom

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Norwegian Air beats profit estimates boosted by strong summer

Oct -22

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How Norwegian’s Expanded Boeing 737 MAX Order Will Impact Norwegian Air Shuttle (OB:NAS) Investors

Oct -10

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This Analyst is Bullish on Boeing (BA) – Here’s Why

Oct -03

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Boeing Bags Large Orders From Turkish Airlines, Norwegian Air

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4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (10.24%)

6. Segments

Passenger Transport

Expected Growth: 10%

Norwegian Air Shuttle ASA's 10% growth in Passenger Transport is driven by increasing demand for low-cost travel, strategic route expansion, and improved operational efficiency. Additionally, the airline's modern fleet and competitive pricing strategy have attracted more customers, contributing to the growth. Furthermore, the rise of online booking platforms and travel agencies has increased accessibility and convenience for passengers, boosting demand.

Ancillary

Expected Growth: 12%

Norwegian Air Shuttle ASA's 12% ancillary growth driven by strategic pricing, increased adoption of optional services, and enhanced customer experience. Key contributors include higher baggage fees, increased sales of food and beverages, and growing demand for premium seats and travel insurance. Effective revenue management and targeted marketing campaigns also support this growth.

Other

Expected Growth: 9%

Norwegian Air Shuttle ASA's 9% growth is driven by increasing demand for low-cost travel, successful route expansion, and improved operational efficiency. Additionally, the airline's modern fleet and competitive pricing strategy have contributed to its growth. Furthermore, the rise of online bookings and digitalization have also boosted sales.

7. Detailed Products

Low-Cost Flights

Norwegian Air Shuttle ASA offers low-cost flights to various destinations in Europe, North Africa, and the Middle East.

Premium Cabin

Norwegian Air Shuttle ASA offers a premium cabin experience with extra legroom, priority check-in, and complimentary meals.

Flex Tickets

Norwegian Air Shuttle ASA offers flexible tickets that allow changes to flight dates or times without incurring additional fees.

Checked Baggage

Norwegian Air Shuttle ASA offers checked baggage services for passengers with excess luggage or special items.

In-Flight Meals

Norwegian Air Shuttle ASA offers a range of in-flight meal options, including snacks and beverages.

Airport Lounge Access

Norwegian Air Shuttle ASA offers airport lounge access for passengers seeking a more comfortable and relaxing airport experience.

Travel Insurance

Norwegian Air Shuttle ASA offers travel insurance options to protect passengers against unforeseen travel disruptions or cancellations.

8. Norwegian Air Shuttle ASA's Porter Forces

Forces Ranking

Threat Of Substitutes

Norwegian Air Shuttle ASA operates in a highly competitive market, but the threat of substitutes is medium due to the lack of viable alternatives for air travel.

Bargaining Power Of Customers

Customers have a high bargaining power due to the availability of multiple airlines and travel options, making it easy for them to switch to a competitor.

Bargaining Power Of Suppliers

Suppliers, such as aircraft manufacturers and fuel providers, have a low bargaining power due to the airline's large scale of operations and negotiating power.

Threat Of New Entrants

The threat of new entrants is low due to the high barriers to entry, including significant capital requirements and regulatory hurdles.

Intensity Of Rivalry

The airline industry is highly competitive, with multiple players competing for market share, leading to a high intensity of rivalry.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 58.04%
Debt Cost 5.67%
Equity Weight 41.96%
Equity Cost 9.35%
WACC 7.21%
Leverage 138.35%

11. Quality Control: Norwegian Air Shuttle ASA passed 4 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

14.21$

Current Price

14.21$

Potential

-0.00%

Expected Cash-Flows