Equities Update: Jet2 holidays, Grafton, Currys, American Eagle, Burberry, Lululemon…

Jet2 holidays hold firm as flight sales under pressure

Lale Akoner, global market analyst, says: “Jet2 is feeling pressure on one side of its business while leaning on strength in another. The airline’s shares dropped after it said profits will likely land at the low end of forecasts, as more customers wait until the last minute to book and overall demand looks softer. To stay cautious, Jet2 is cutting back some of its planned winter seat capacity, though it still expects growth.

“We think the story is split: package holidays are holding up, but flight-only sales are under pressure, especially as Jet2 expands into southern UK airports where easyJet is already strong. With UK consumers squeezed by higher living costs and turning more price-sensitive, the key question is whether Jet2’s holiday packages can keep offsetting weaker seat-only sales. Packages remain popular thanks to convenience and value, and Jet2’s brand is well-regarded. But if flight-only yields keep sliding, margins could come under strain even as overall travel demand stays resilient.”

Grafton delivers growth when investors were braced for a slowdown

Mark Crouch, market analyst for eToro, says: “Grafton’s latest update has the feel of a plot twist. Just as markets were bracing for more bad news from the builders’ merchants, the company has delivered growth, acquisitions and rising profits. In a sector where costs, caution and construction gloom have dominated the narrative, Grafton’s numbers suggest it’s not all cracks in the plaster. Profits are climbing, margins are holding, and management seems intent on building out further afield. For investors, it’s an unexpected dose of resilience in an industry that’s been anything but.

“The question now is whether Grafton is the exception or the advance guard of a turn in the cycle. Its international footprint and bolt-on deals have given it a sturdier foundation than many peers, but strong results here also hint at pockets of demand that contradict the prevailing pessimism. If Grafton can grow against the grain, perhaps the wider economy isn’t quite as brittle as feared. Investors will be asking, is this company simply outperforming, or is sentiment about to shift more broadly?

Currys’ revenue heats up over the summer

Adam Vettese, market analyst for eToro, says: “As we’ve all been trying to cool off over the particularly hot summer, Currys’ sales have done the opposite as consumers flock towards fans, AC and similar cooling products driving like for like revenue up 3%.

“Market share gains in growth categories such as gaming and AI computing also contributed.

“The company’s strategy to expand recurring service revenues is clearly paying off, as seen in the strong uplift in credit adoption and another impressive jump in iD Mobile subscribers. In the Nordics, a continued focus on profitable sales and cost controls is improving margin quality, although challenging consumer conditions persist.

“Currys is demonstrating capital discipline with its new £50 million share buyback and sustainable dividend, alongside a sharply reduced pension deficit and manageable outflows. The business is well positioned with a year end net cash target of at least £100 million and management is planning confidently for the year ahead, comfortable with consensus profit expectations although these will not be adjusted either way until after the peak trading period.

“While some legacy categories remain under pressure, the ongoing pivot to high margin segments and services underlines Currys’ ability to deliver resilient performance within a challenging retail environment. Shares have trended upwards for the last 2 years and investors will be hoping this update lays the foundations for more of the same.”

Lale Akoner on American Eagle’s Q2 earnings

Lale Akoner, global market analyst, says: “American Eagle’s Q2 results eased concerns around execution and proved marketing momentum is translating into sales, driving a sharp stock re-rating. Shares jumped 20% after internet traffic gains, disciplined promotions, and stronger margins drove operating income growth, while Aerie hit record sales and AE denim regained traction. Crucially, celebrity campaigns with Sydney Sweeney and Travis Kelce generated ~700k new customers, 40B impressions, and record Labor Day sales, validating the brand reset strategy.

“The near-term debate shifts to durability; can momentum in denim and Aerie offset the ~$70m in tariff headwinds and increased ad spend in 2H? With management guiding sales to grow low single digits and emphasized margin stability, execution into the key Q4 holiday season will be key to sustaining investor confidence.”

Burberry’s FTSE 100 Return Is More Than Symbolic

Lale Akoner, global market analyst, says: “Rejoining the FTSE 100 signals Burberry’s turnaround is gaining traction. The company has regained momentum at a time when much of the luxury sector is struggling, showing a turnaround story idiosyncratic to the group. In our view, the upgrade validates CEO Schulman’s strategy: the refocus on brand strength and core outerwear segment is paying off, and investors are rewarding it.

“Rejoining the benchmark also raises Burberry’s profile with global investors, reinforcing the brand’s status at home just as it looks to scale globally. The shares have already rallied strongly this year, but being back in the index could act as another catalyst, drawing in passive inflows and broadening the shareholder base. That matters, given sentiment around European luxury has been fragile, and Burberry now stands out as an exception. At a time when peers are warning of weaker aspirational demand, Burberry’s ability to surprise positively on retail sales highlights how execution, not just macro trends, is driving investor returns.

“The challenge now will be turning momentum into staying power. The next phase depends on whether Burberry can replicate its outerwear success across categories, deliver on margin recovery and cost savings, and stabilise China revenues while managing wholesale headwinds. How well the company executes on these fronts will determine whether this comeback endures.”

Lale Akoner on the upcoming Lululemon earnings

Lale Akoner, global market analyst, says: “Lululemon heads into its Q2 earnings with growing concerns about consumer demand and margin pressure. Earlier this year, the athleisure giant warned that new US tariffs and softer North American store traffic would hurt profits, prompting a cut to full-year EPS guidance. Analysts now anticipate modest sales growth of 7-8% in the quarter, but earnings are expected to miss consensus with EPS forecast in the $2.85-$2.90 range.

“Investors will be watching closely to see how the brand manages elevated inventory and cautious US consumer behaviour, both of which are driving margins pressure and promotional intensity. Questions also linger over the impact of recent product launches like Glow Up and Daydrift, and whether they can offset domestic slowdown amid intensifying competition. While international expansion remains a bright spot, the earnings call will likely centre on how management balances inventory clean-up, tariff cost absorption, and sustaining brand equity into the holiday season.”