Qantas Airways shares (ASX: QAN) are experiencing a resurgence, gaining an impressive 3.46% gain in the final session of the week, after a recent pause for breath. Today’s upwards move comes after a two day pause had seen a 4% pullback follow an eight-day winning streak, and puts QAN back on a bullish flightpath. This reignites discussions about whether the airline can break through the $11 resistance level. Several factors are contributing to this positive momentum, including a strong financial performance, shareholder returns, and optimistic technical indicators.
The recent price action has been encouraging, with Qantas shares consistently climbing in recent months. The rally from April’s low extends to more than 33% and puts shares back in the range where bulls will fancy a retest of highs ($11.06). In a period of price discovery, volatility around certain levels should be watched and noted, as potential signs of support and resistance in times to come.
Operationally, the airline’s recent financial results have been a major catalyst for the stock’s rally. In February, Qantas reported its second-best financial result on record, with an interim underlying profit of $1.39 billion for the six months ending December 31, 2024. This impressive performance, coupled with the resumption of dividend payments after a six-year hiatus, has significantly boosted investor sentiment. The company declared a 16.5-cent per share dividend, along with a special dividend of 9.9 cents, paid out on April 16, 2025. Furthermore, in March, Qantas declared an interim dividend of $0.264 per share, an increase from the previous interim dividend of $0.14, representing a dividend yield of 2.77%, which further solidified its commitment to rewarding shareholders.
Qantas’s strong capital allocation and efficient use of resources continue to impress analysts. The company boasts a return on capital employed (ROCE) of 25%, significantly higher than the airline industry average. This indicates that Qantas is effectively deploying capital to generate profits, further bolstering investor confidence. Despite this, price targets have not keep pace with the shares themselves, as the average target of $10.19 now sits below current price action. Adjustments could well be expected upon the next financial updates, although this will depend heavily on how well the firm executes, as well as how the street treats the narrative.
Looking ahead, investors will be closely monitoring upcoming events, including the Preliminary Report on August 28, 2025, the Annual Report on September 11, 2025. These reports will provide further insights into the company’s financial performance and strategic direction.
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For now, Qantas Airways is currently riding a wave of positive momentum, driven by strong financial results, shareholder returns, and strong technical indicators. While challenges remain, the airline’s resilience and commitment to value creation are fueling investor optimism and driving the share price towards the $11 resistance level. Whether it can sustain this momentum and achieve a breakout remains to be seen, but the current outlook is undeniably positive.
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