Israir CEO Sees Strong Recovery Potential Despite Wartime Setbacks
Israir Airlines shares lag behind El Al amid war challenges, but CEO Uri Sirkis predicts a profitable 2026, driven by strong summer traffic and new growth engines.
Is there an investment opportunity in Israir Airlines? According to CEO Uri Sirkis, the answer may well be positive. Since the outbreak of the war in Gaza, El Al Israel Airlines shares have surged by more than 400% to a current market capitalization of 11.2 billion NIS, and the company is set to join the Tel Aviv 35 Index in the upcoming index update. In contrast, Israir Airlines shares fell by 9% over the same period and are currently traded at a market value of 446 million NIS.
Financial Challenges and H1 Losses
Of course, comparing the two airlines in terms of fleet size and overall scale is difficult. Nevertheless, the military conflicts that have hit the country over the past three years, resulting in frequent airspace closures and the withdrawal of foreign airlines, have brought handsome profits to El Al. In the last half-year alone, these profits totaled 57 million dollars. Israir, however, did not share equally in the windfall and posted a loss of 35 million dollars.
According to Israir's financial reports, Operation Iron Swords and the confrontation with Iran, which led to sweeping airspace closures in Israel, accounted for the lion's share of the first-half loss, totaling 26 million dollars.
"Investors love short-term profits, but if you look at the growth engines Israir has developed, its chance to double in value is greater than El Al's chance to double," said Uri Sirkis.
Growth Engines and Market Share
Sirkis is confident that an operational turnaround is just around the corner and that the company will finish 2026 in the black. He noted that the company carried out efficiency measures, cutting about 5% of its workforce, and expressed certainty that second-half results will compensate for the heavy losses and a 60% surge in jet fuel prices over the past year.
Data from Ben Gurion Airport underpins this optimism. Israir was the second-largest airline by market share at Ben Gurion Airport during the third quarter, carrying about 20% of all passengers. During the peak summer demand season, Israir flew 927,000 passengers, a 15% increase compared to the same quarter last year. Furthermore, the company is investing 10 million dollars to expand its maintenance center in Larnaca, Cyprus, adding value that Sirkis argues is not yet priced into the stock.
