Investors are looking for the exit after budget-friendly airline Wizz Air (WIZZ) cut profit guidance for the full year from a range of €245m to €255m to between €225m and €235m.

It blames lower fares and bad weather for reeling back expectations this year. That outlook spooks investors and the shares have slumped nearly 9.5% to £16.13 on Wednesday.

It’s been a bumpy ride for the whole airline industry since the Brexit vote and even Wizz is feeling the squeeze of weaker Euro-priced fares from the UK due to a struggling pound.

On the flip-side, the airline unveiled robust figures for the third quarter to 31 December 2016. The Airline reported a 9.9% rise revenue €341.1m and more than 20% more passengers flown with just a single extra Airbus A321 aircraft

Wizz Air graph  feb2

But underlying profit after tax slumped by a fifth to €13.5m.

Panmure Gordon analyst Mark Irvine-Fortescue reiterated his view that Wizz remains a top pick in the travel space.

He believes investors are underestimating its potential for growth as it has ‘the raw ingredients and market conditions to take its already successful formula to a whole new scale.’

But in the short-term, lower pricing may prevent the company from maximising the benefit of increasing traveller numbers looking for a cheap getaway.

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Issue Date: 01 Feb 2017