Qantas is optimistic about the launch of multi-stop flights on ultra long-haul routes.

Citigroup's multiple heads towards Qantas Airways are cautiously optimistic about the Australian airline's launch of ultra-long-haul routes. Analyst Samuel Seow believes that the investment rationale and basis for Qantas' initial Sydney to London direct flight route seems reasonable. He told clients in a report that the airline currently enjoys a 20% premium in passenger revenue per kilometer on its comparable Sydney to Perth route. He added that the A350 aircraft used by Qantas on these routes can also carry more cargo. As Qantas introduces ultra-long-haul services on more proven and profitable routes, Seow believes that the phased implementation of the plan reduces the risk in the early stages of the project. Citigroup rates the stock as "buy" with a target price of $10.40 Australian dollars.