Air France-KLM (ENXTPA:AF) is back in focus after Air France detailed plans to move all New York JFK flights to the new Terminal One and to open its largest international lounge.
Despite the New York JFK upgrade and recent comments from CEO Ben Smith on fuel costs and route mix, Air France-KLM’s share price has drifted, with a 30-day share price return of down 2.7% and a 1-year total shareholder return of down 3.6%. This suggests fading momentum rather than renewed enthusiasm.
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Air France-KLM is pushing premium service harder, yet the share price has slipped and long term returns remain weak. Are investors getting a strong global carrier at a modest price, or just fairly paid turbulence?
Price-to-Earnings of 2.8x: Is it justified?
Air France-KLM is valued on a very low earnings multiple, with a P/E of 2.8x against a last close at €11.44, which points to a market that prices the stock well below many peers.
The P/E ratio compares what investors pay for each euro of profit. For an airline that reports €1,084.0m in net income on €34,155.0m of revenue, this lens shows how much confidence the market has in those earnings and how repeatable they appear.
Here the gap is wide. Air France-KLM trades on a P/E of 2.8x, while the Global Airlines industry is around 11x and the identified peer group averages 17.5x. The internal fair P/E estimate of 13.5x is also far above the current level, which reflects a market valuation that is far more cautious than the earnings profile and fair ratio suggest.
Explore the SWS fair ratio for Air France-KLM.
Result: Price-to-Earnings of 2.8x (UNDERVALUED)
Still, Air France-KLM carries clear risks that could challenge any value case, including prolonged share price weakness and pressure on already fragile long term returns.
Find out about the key risks to this Air France-KLM narrative.
Another View on Air France-KLM’s Value
The P/E story paints Air France-KLM as cheap, yet our DCF model points in the same direction, with an estimated future cash flow value of €57.69 against a share price of €11.44. That gap is very large. Is this a rare mispricing, or a sign the cash flow assumptions are too generous?
Look into how the SWS DCF model arrives at its fair value.
AF Discounted Cash Flow as at Sep 2026
Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Air France-KLM for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 179 high quality undervalued stocks. If you save a screener we even alert you when new companies match – so you never miss a potential opportunity.