Should I buy Air Transat stock in 2025?

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At HelloSafe, our expert has been monitoring Air Transat's performance for over three years. Each month, hundreds of thousands of users across Canada rely on us to interpret market trends and identify top investment opportunities. Our analyses are designed for informational purposes only and do not constitute investment advice. In line with our ethical charter, we have never been, and will never be, compensated by Air Transat.

What is Air Transat?

How much is Air Transat stock?

The price of Air Transat stock is rising this week. As of today, TRZ trades at CA$1.54, up 1.32% over the past 24 hours and gaining 2.0% this week. The company’s market capitalization stands at CA$61.08 million, with an average 3-month daily volume of 36,993 shares.

Air Transat’s P/E ratio is currently negative, and the stock does not pay a dividend, while the latest reported beta indicates moderate market sensitivity. Given recent volatility and the mixed outlook, investors may find both opportunity and risk in this segment of Canada’s travel market.

Our full analysis on Air Transat stock

After a detailed evaluation of Air Transat’s most recent financial results and an in-depth review of its stock performance across the past three years, we have synthesized a broad spectrum of data—ranging from core financial indicators to nuanced technical analysis and peer benchmarking—using our proprietary analytic models. The evidence suggests evolving momentum in both the operational and market positioning of this iconic Canadian leisure travel brand. So, why might Air Transat stock once again become a strategic entry point into the travel and leisure sector in 2025?

Recent Performance and Market Context

Air Transat (Transat A.T. Inc., TSX: TRZ) has exhibited a resilient trajectory against a backdrop of persistent industry volatility, especially evident in its stock price movement and operational resilience. On April 30, 2025, TRZ closed at CA$1.54, reflecting a modest daily gain (+1.32%) and standing closer to its 52-week low (CA$1.41) than its recent high (CA$3.74). This significant pullback from last year’s peak is notable, providing a more attractive risk-reward profile for new entrants.

Several recent positive events reinforce this opportunity:

• Financial Recovery: Q1 2025 results surpassed expectations with revenues increasing by 5.6% year-over-year to CA$829.5 million and a positive swing in adjusted EBITDA (CA$20.0 million versus a negative CA$3.3 million the previous year). Free cash flow soared to CA$129.1 million, more than triple the previous period.
• Operational Efficacy: Declining fuel prices (down 15% versus Q1 2024) and lower aircraft rental rates materially boosted margins.
• Brand Recognition: Air Transat’s distinction as the “World’s Best Leisure Airline” at the 2024 Skytrax Awards reiterates its market leadership.

The broader macroeconomic environment now seems distinctly more favourable for the sector: steady post-pandemic travel recovery, softer jet fuel prices, and robust Canadian consumer confidence all form a foundation for sustained demand growth. These developments, when taken together, cast Air Transat as a compelling rebound candidate—especially when compared to Canadian aviation peers who face similar headwinds yet lack the same degree of integrated vertical strategy or recognized leisure specialization.

Technical Analysis

From a technical perspective, Air Transat’s stock is at a potentially constructive juncture, consolidating near key support levels and showing the initial traces of bullish reversal, particularly when interpreted within the current volume structure:

• Relative Strength Index (RSI-14) at 48.3: This neutral territory suggests neither overbought nor oversold conditions, typically preceding directional inflections.
• Moving Average Convergence Divergence (MACD at -0.02): A mild sell signal, but approaching convergence, indicating downside momentum may be waning.
• Short-term Moving Averages (5- and 20-day MAs at CA$1.51 and CA$1.52): Both hover at or below the current price, reflecting imminent pressure on resistance around CA$1.53–CA$1.56. A clear close above these levels could ignite further buying interest.
• Medium/Long-Term MAs (50-, 100-, 200-day at CA$1.59, CA$1.73, and CA$1.82): These continue to show residual bearishness, but this often provides fertile ground for preliminary accumulation, especially if a reversal unfolds at structurally significant supports.
• Key Support Zones: CA$1.45–CA$1.49 range has repeatedly absorbed selling pressure, establishing a credible technical “floor.”

There’s growing evidence of bottom-building behavior. Despite indecision in the longer-term signals, shorter-term indicators and repeated defense of support zones suggest the potential for a technical base, which, if confirmed by a move through resistance, could catalyze a medium-term bullish phase.

Fundamental Analysis

Air Transat’s recent quarter confirms a trajectory of improving fundamentals—an essential underpinning for a sustainable rerating:

• Revenue Growth: Robust 5.6% increase year-on-year, led by higher airfare yield and disciplined capacity management.
• Profitability Metrics: Transition to positive adjusted EBITDA (CA$20.0 million) highlights progress toward cash generativity, supported by strong free cash flow numbers (CA$129.1 million).
• Cost Efficiencies: The Elevation Program has significantly reduced fuel and rental costs—efforts that are tracking ahead of schedule and are forecast to deliver CA$100 million in annualized EBITDA benefits by 2026.
• Valuation Metrics: At a market cap of only CA$61.08 million and with an analyst average price target at CA$1.88, Air Transat is trading on a Price/Sales ratio considerably below industry norms. Given that the normalized Canadian airline sector typically values double-digit cash flow multiples, this compressed valuation offers a margin of safety and notable upside optionality.
• Strategic Moat: Air Transat’s vertical integration, encompassing airline operations, travel packaging, and distribution, fosters resilient demand capture and brand loyalty—differentiators increasingly prized in a post-pandemic landscape. Its recent Skytrax accolade and innovation in technology (AI-driven route optimization, for instance) further reinforce its structural strengths.

In sum, the company’s fundamentals are on a clear upward trajectory, supported by both operational execution and strategic cost initiatives. While net losses remain, their context—significant debt servicing and investment in future growth—should be weighed against the improving cash flow and EBITDA trends.

Volume and Liquidity

Sustained trading activity underpins the stock’s legitimacy and potential for dynamic valuation moves:

• Average Daily Volume: With nearly 37,000 shares traded daily, liquidity is adequate for orderly accumulation without excessive volatility.
• Float Characteristics: A relatively modest market capitalization and float enable positive news or influxes of institutional capital to have outsized impacts on price discovery.
• Investor Confidence: Increased volume on up days in recent weeks indicates latent market interest, possibly tied to improved financial performance and sector optimism.

Periods of sideward consolidation at higher volumes, as currently observed, tend to precede revaluations—especially when fundamentals show marked improvement.

Catalysts and Positive Outlook

A series of clear catalysts and forward-looking initiatives position Air Transat for tangible upside:

• Elevation Program Milestones: The ongoing execution of this comprehensive efficiency campaign is anticipated to unlock incremental EBITDA and operational leverage in FY2025–2026.
• Productivity & Technological Innovation: Implementation of AI and other digital tools is already enhancing route optimization and cost control.
• Debt Management Progress: Extension of over CA$400 million of key debt maturities, coupled with active refinancing discussions, dramatically reduces near-term balance sheet risk and opens the door for strategic reinvestment.
• Sector Tailwinds:
• Rising travel demand fueled by both leisure and pent-up bucket-list tourism.
• Lower energy costs providing a systemic margin tailwind.
• Strengthening global airline yields offsetting lingering inflation pressures.
• Regulatory and Sustainability Alignment: Proactive engagement with government stakeholders on financing, plus emphasis on ESG best practices, increasingly matters to institutional capital and consumer choice.

In the context of upward revisions in analyst price targets (implying approximately 22% upside from current levels), these catalysts collectively provide a credible blueprint for a new phase of valuation expansion.

Investment Strategies

Several arguments support a considered entry into Air Transat across different investor profiles and time horizons:

• Short-Term (Swing/Technical Buy):
• Accumulating at or just above support (CA$1.45–CA$1.49) offers a defined risk profile, with upside to first resistance at CA$1.56 or analyst targets in the CA$1.75–CA$2.00 range.
• Catalysts such as upcoming financial releases or further news on debt restructuring may trigger rapid re-rating.
• Medium-Term (Catalyst-Driven Growth):
• Participation as the Elevation Program delivers sequential cost and revenue improvements, evidenced in quarterly reporting.
• Positioning ahead of anticipated upward mobility in sector demand and further optimization milestones (mid-2026 EBITDA target of CA$100 million).
• Long-Term (Core Turnaround Play):
• For investors seeking discounted exposure to travel sector normalization, Air Transat’s vertical model and continued operational enhancements set a foundation for profitable growth and potential revaluation toward industry medians.

At present levels, the risk/reward skew appears advantageous, particularly given multiple levers for operational and financial upside, a compressed valuation base, and improving liquidity dynamics.

Is It the Right Time to Buy Air Transat?

Synthesizing these factors, Air Transat stands at the nexus of low valuation, tangible operational improvement, and a clear roadmap for margin and revenue growth. The combination of disciplined financial management, sector tailwinds, and a string of executable catalysts—including further advances in its flagship Elevation Program and proactive balance sheet optimization—distinguishes TRZ as a stock where upside potential is underappreciated by current market pricing.

While certain risks remain, notably the need for ongoing progress in debt reduction and continued delivery against operational goals, the evidence points to a company in managed turnaround, with solidifying fundamentals and latent brand-driven demand. The technical landscape offers the further prospect of a base-formation breakout, while analyst targets suggest the market could be materially underestimating forward prospects.

For Canadian investors seeking re-entry into the travel and leisure sector with an eye for strategic value and asymmetric upside, Air Transat seems to represent an excellent opportunity. The positive momentum in both operational and market terms, reinforced by accretive catalysts on the near-term horizon, justifies renewed attention from discerning buyers looking to capitalize on a potential inflection point in this storied Canadian airline's journey.

How to buy Air Transat stock in Canada?

Buying Air Transat (Transat A.T. Inc., TSX: TRZ) stock online is straightforward and secure when you use a regulated Canadian broker. Whether you’re seeking to own shares outright or to speculate on price movements, there are two main ways to proceed: spot buying (direct share ownership) or trading Contracts for Difference (CFDs). Both methods allow you to access Air Transat’s potential in just a few clicks, from your computer or mobile. Choosing the right broker is an important first step—be sure to consult our broker comparison further down the page to find the best fit for your investing needs.

Spot Buying

With spot buying, you purchase Air Transat shares directly on the Toronto Stock Exchange and become a part-owner of the company. This is the most straightforward and traditional approach, ideal for investors seeking long-term ownership and potential dividends, if they are declared in the future. Brokers usually charge a fixed commission per trade, often around $5–$10 CAD for each order.

Informations importantes

For example, if Air Transat shares are trading at CA$1.54, a $1,000 CAD investment (after deducting a CA$5 commission) lets you buy about 645 shares.
Gain scenario:
If the share price rises by 10%, your holding would be worth CA$1,100. That’s a CA$100 gross gain—an increase of 10% on your original investment, minus any selling fees.

Trading via CFD

CFDs (Contracts for Difference) enable you to speculate on the price movements of Air Transat shares without owning them. This method appeals to more active traders, as you can profit from both rising and falling prices and apply leverage to amplify your exposure. CFD brokers typically charge a spread (the difference between buy and sell prices) and overnight financing costs if holding positions longer than one day.

Informations importantes

For example, with $1,000 CAD and 5× leverage, you can open a CFD position representing $5,000 CAD in Air Transat stock.
Gain scenario:
If Air Transat shares rise by 8%, the value of your position increases by 8% × 5 = 40%, or $400 CAD, on your $1,000 stake (excluding fees and interest).

Final Advice

Before investing, take the time to compare brokers’ fees, trading platforms, and terms to ensure you’re getting the best deal for your strategy—our detailed broker comparison is available further down this page. Ultimately, whether you choose spot buying for long-term ownership or CFD trading for more flexibility and leverage, the right method depends on your risk tolerance and investment objectives. Equip yourself with the right information, and take your first step towards investing in Air Transat stock with confidence!

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Our 7 tips for buying Air Transat stock

The latest news about Air Transat

Air Transat posted a 5.6% year-over-year revenue increase in Q1 2025, reaching CA$829.5 million. This financial momentum is supported by growth in passenger traffic and a 1.7% increase in airline unit revenues (yield) compared to the previous year. The company also reported a significant turnaround in operational profitability, achieving CA$20.0 million in adjusted EBITDA versus a negative CA$3.3 million the prior year. This improvement was largely attributed to cost management disciplines, robust travel demand, and a lower fuel price environment—a particularly relevant tailwind for Canadian carriers given their exposure to fuel cost volatility.

Transat's Elevation Program is delivering tangible results, supporting profitability and future growth prospects. The strategic plan has already realized an annualized adjusted EBITDA run-rate of CA$37 million and remains on track to reach CA$100 million in efficiency gains by mid-2026. The program's first phase has reduced organizational costs and implemented new technology tools, with near-term focus shifting to revenue and productivity enhancements. These initiatives are beginning to strengthen Air Transat’s competitive position in the Canadian market, where cost structures and innovation are key differentiators.

Debt refinancing efforts have improved Air Transat's financial flexibility despite high leverage. The company successfully extended maturity dates on substantial government and revolving credit lines, providing critical breathing room as it navigates its ongoing operational recovery. In particular, the extension of CA$312.0 million in LEEFF government support and CA$50.0 million in revolving credit to 2026–2027 underscores support from key financial stakeholders, a constructive signal for Canadian investors focused on debt risks. Free cash flow also surged to CA$129.1 million, further improving the company’s liquidity profile.

Air Transat’s recognition as the World's Best Leisure Airline in 2024 boosts brand equity and traveler confidence. This accolade from the Skytrax World Airline Awards, voted by passengers, reinforces the airline’s reputation as a premier leisure carrier and supports its continued appeal among Canadian vacationers. The positive brand momentum may bolster sales in the critical summer and winter travel seasons, supporting load factors and yields essential for financial recovery.

Analyst consensus currently rates Air Transat as 'Hold' but sees potential for a 22% share price upside. Despite some technical indicators turning bearish in the medium and longer term, the average analyst target of CA$1.88 per share offers attractive upside from the current price of CA$1.54. This supportive outlook is underpinned by operational improvements, post-pandemic travel recovery, and incremental gains from Elevation Program initiatives, although analysts remain cautious given persistent net losses and industry competition.

FAQ

P. Laurore

Finance expert

Co-founder of HelloSafe and holder of a Master's degree in finance, Pauline has recognised expertise in personal finance, which she uses to help users better understand and optimise their financial choices. At HelloSafe, Pauline plays a key role in designing clear, educational content on savings, investments and personal finance. Passionate about financial education, Pauline strives, with every piece of content she oversees, to provide reliable, transparent and unbiased information for independent and informed financial management. To this end, she has tested over 100 trading platforms to help internet users make the right choices.