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Investing.com -- Bank of America lowered its price target on Airbus to €255 from €259 while maintaining a Buy rating, citing cost pressures from disrupted aluminum supplies following strikes on Gulf smelters.
Iranian missile and drone strikes hit aluminum facilities in the United Arab Emirates and Bahrain over the weekend. The attacks damaged the Al Taweelah site in Abu Dhabi, operated by Emirates Global Aluminum, and the Alba facility in Bahrain. Alba declared force majeure on deliveries following the strikes.
The two facilities produced approximately 1.6 million metric tons of aluminum each in 2025, representing roughly 4% of global aluminum supply. LME aluminum prices rose approximately 6% since the strikes and are up around 15% from pre-war levels.
Bank of America expects the supply disruption to create cost headwinds for Airbus through 2026 and 2027. The firm estimates inflation headwinds of €100 million in 2026 and €200 million in 2027, with price-cost neutrality now unlikely in 2026.
The bank reduced its delivery forecasts to 860 aircraft in 2026 and 960 in 2027, assuming some supply chain disruption. The firm also pushed its expected gross margin inflection on the A350 program out by one to two years.
These changes resulted in a 5% to 8% reduction in EBIT estimates for 2026 and 2027. Airbus shares traded at €159.18.
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