National Bank just cut its target on this Canadian airline stock

National Bank of Canada Capital Markets analyst Cameron Doerksen said in a note ahead of Cargojet’s (Cargojet Stock Quote, Chart, News, Analysts, Financials TSX:CJT) May 4 results that domestic air cargo demand has remained “healthy” through the first quarter, but he still expects headwinds to overall revenue growth.

As reported by the Globe and Mail, on April 22, Doerksen trimmed his target price to $104.00 from $108.00 and maintained an “Outperform” rating. The street average is $117.23.

He said Cargojet’s domestic network has continued to perform well, with revenue up 13.6% year-over-year in 2025, though he expects growth to moderate in the first quarter of 2026. He is forecasting 3.0% domestic revenue growth for the quarter.

The analyst said ACMI revenue has declined year-over-year for the past four quarters because DHL block hours have fallen as routes shifted toward shorter-haul flying operated by Cargojet on its behalf. Doerksen expects ACMI revenue to decline another 5.0% in the first quarter.

He also said all-in charter revenue faces a tougher comparison because flights to China ended after an e-commerce contract expired. That should be partly offset by new charter routes into Latin America and some incremental flying for UPS, but Doerksen still expects all-in charter revenue to fall 15%year-over-year in the quarter.

Doerksen raised his revenue forecast largely to reflect higher fuel surcharge revenue, noting that Cargojet is passing through higher costs through surcharges or contract terms in its ACMI and charter businesses. Still, he said a lag in collecting those surcharges can weigh on near-term profitability.

“We have therefore trimmed our Q1/26 profitability forecast with only a minor impact on our full-year 2026 estimates,” Doerksen said. “We have made some other minor forecast adjustments for 2027, which results in a slight reduction in our profit estimates.”

It’s against that backdrop that Doerksen trimmed his target price.

He said Cargojet’s more internationally exposed ACMI and charter operations will likely continue to face end-market headwinds in coming quarters, though the company has won some offsetting business, including a new scheduled charter into Latin America for an unnamed customer and added UPS work tied to the grounding of part of that carrier’s MD-11 fleet.

Doerksen said valuation remains “interesting,” with the shares trading at 7.1x his 2026 EV/EBITDA forecast, below the stock’s long-term historical average of 10.5x and slightly below its post-COVID three-year average of 7.6x. He also noted the shares are trading at a discount to the parcel and courier peer group at 8.7x 2026 EV/EBITDA.

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