The easyJet (LSE: EZJ) share price has been on a tear lately. It’s up 17.64% over one year, and 69.02% over two.

Yet it’s still carrying baggage from the pandemic. easyJet shares trade almost 50% lower than five years ago. Is there still recovery opportunity here?

Can this FTSE 100 stock keep flying?

Covid continues to cast a shadow over airlines. They were hit harder than almost any other sector as carriers were forced to ground entire fleets during lockdown, but had to continue paying staff and maintaining aircraft.

Ever since, investors have been torn between taking advantage of their subsequent low valuations, and shielding themselves from future threats.

The pandemic taught us that airlines are on the front line of every crisis. Inflation drives up costs, recessions hit demand, wars can close key routes while severe weather and natural disasters are a constant menace.

Investors can’t expect a smooth ride. In fact, easyJet only escaped relegation from the FTSE 100 by the skin of its teeth over the summer. Happily, there’s still an opportunity to buy at a decent valuation. Shares in the Luton-headquartered business trade at just 10.96 times trailing earnings.

It looks even better value measured by its price-to-sales ratio, which compares a company’s share price to its revenues. With a P/S of 0.5, investors are essentially paying 50p for each £1 of sales the company makes. This also reflects the risks they’re taking.

With operating margins of just 5.5%, easyJet doesn’t have much room for error. Margins are forecast to creep up to 6.7% this year.

The dividend is set to climb… slowly

On 25 September, JPMorgan Cazenove labelled it a “high conviction” Buy among low-cost carriers, due to its pricing and earnings being more resilient than those of its peers.

Inevitably, easyJet axed all dividends during the pandemic. It used to be pretty nifty at rewarding shareholders before that, as this chart shows.

Chart by TradingView

The dividend is back after four long years with the board expected to pay 4.5p per share this year. That’s way below the 43.9p it paid pre-Covid, so let’s not get too excited. Today’s yield is just 0.9% and that’s forecast to edge up to just 1.46% by 2027. That’s partly because it had to issue so many new shares to raise capital to withstand the pandemic.

Passenger demand is rising as the cost-of-living crisis eases, but growing competition has hit prices. I’m also wary of events in the Middle East as a higher oil price could squeeze easyJet’s margins. It still carried debt of €3.66bn in March.

I’m impressed by the easyJet share price recovery and think it could continue, if wider economic sentiment holds up. However, I think I’ve missed the moment of maximum opportunity. I can see better growth and income opportunities out there.