08:25 AM EDT, 09/25/2024 (MT Newswires) -- National Bank has lowered its target on Air Canada ( ACDVF ) by $2, to $22, but kept its Outperform rating on the stock, ahead of third quarter results.

"While there is still some risk that the recently reached tentative agreement with its pilots is not ratified, we believe the confirmation of a new deal would remove a key overhang on the stock," notes analyst Cameron Doerksen.

While yields have softened over the summer, especially on international routes, Doerksen is encouraged to see capacity growth decelerate in the fourth quarter. The easing of jet fuel prices in the third quarter also provides material cost relief for Air Canada ( ACDVF ) in the quarter and potentially for the rest of the year.