Stefan Ćulibrk of Highway One Asset Management presented his thesis on Ryanair (Ireland: RYA, US: RYAAY) at Wide-Moat Investing Summit 2025.
Thesis Summary
Ryanair stands out as a best-in-class, low-cost airline that has managed exceptional growth and capital efficiency in an industry known for intense capital expenditures and high leverage. Unlike its peers — such as IAG, Lufthansa, and Air France-KLM, which have significantly increased share counts and accumulated substantial debt to finance fleet expansions — Ryanair has uniquely reduced its share count and maintained a net cash position, recently boasting a negative net debt/EBITDA ratio of -0.4x, indicative of its robust balance sheet strength.
Ryanair’s disciplined, low-cost model benefits from a combination of factors, including complete aircraft ownership, efficient operational management, and a relentless focus on cost control driven by its fanatically committed owner-operator culture. This operational model has enabled Ryanair to achieve consistently superior ROCE, outperforming competitors. Furthermore, Ryanair’s ability to sustainably charge higher average fares while maintaining low costs positions the company advantageously amid rising European emissions trading scheme (ETS) costs, which disproportionately affect rivals.
The competitive landscape further amplifies Ryanair’s strategic advantage. With Boeing and Airbus fully booked for the next decade, competitors are constrained from swiftly expanding their fleets. At the same time, competitors like Wizz Air are incrementally shifting away from Europe, reducing direct competitive pressures within Ryanair’s core market. Ryanair is expected to capitalize on this environment, significantly increasing net profit per passenger beyond previous peaks, supported by stable and growing market share in the European airline market.
Despite industry nuisances and macroeconomic risks — including oil price volatility, economic cycles, and environmental regulations — Ryanair’s resilient operating model, strong financial position, and pricing power make it an attractive investment, particularly in a sector otherwise characterized by significant capital intensity and cyclical challenges.
Disclaimer
Wide-Moat Investing Summit 2025 was held from June 24 through July 9, 2025. The content of this website is not an offer to sell or the solicitation of an offer to buy any security. The content is distributed for informational purposes only and should not be construed as investment advice or a recommendation to sell or buy any security or other investment, or undertake any investment strategy. There are no warranties, expressed or implied, as to the accuracy, completeness, or results obtained from any information set forth on this website. BeyondProxy’s officers, directors, employees, and/or contributing authors may have positions in and may, from time to time, make purchases or sales of the securities or other investments discussed or evaluated herein.
Slides
Let’s take a closer look.
