reports
With a more favourable environment, CATHAY PACIFIC AIRWAYS improves to...
CATHAY PACIFIC AIRWAYS (HK), a company active in the Airlines industry, is favoured by a more supportive environment. The independent financial analyst theScreener has confirmed the fundamental rating of the title, which shows 3 out of 4 stars, as well as its unchanged, defensive market behaviour. The title leverages a more favourable environment and raises its general evaluation to Positive. As of the analysis date February 25, 2022, the closing price was HKD 7.06 and its potential was estimate...
- Ivan Su
Morningstar | HK Express Acquisition Confirmed; Cathay FVE Maintained ...
No-moat Cathay Pacific confirmed its plan to acquire low-cost-carrier, or LCC, Hong Kong Express, or HKE, for HKD 4.9 billion. The acquisition will be financed by roughly 46% cash on hand and 54% promissory notes. Ever since the rumor surfaced, we have said that Cathay Pacific will be a stronger company with a budget airline arm. HKE is the sole LCC based in Hong Kong, and its business perfectly complements that of legacy carrier Cathay. We are maintaining our HKD 12.20 fair value estimate for C...
- Ivan Su
HK Express Acquisition Confirmed; Cathay FVE Maintained Pending Releas...
No-moat Cathay Pacific confirmed its plan to acquire low-cost-carrier, or LCC, Hong Kong Express, or HKE, for HKD 4.9 billion. The acquisition will be financed by roughly 46% cash on hand and 54% promissory notes. Ever since the rumor surfaced, we have said that Cathay Pacific will be a stronger company with a budget airline arm. HKE is the sole LCC based in Hong Kong, and its business perfectly complements that of legacy carrier Cathay. We are maintaining our HKD 12.20 fair value estimate for C...
- Ivan Su
Morningstar | Uncertainties Around Geopolitical Tensions Weigh on Cath...
Our HKD 12.20 fair value estimate and no-moat rating are unchanged after Cathay Pacific Airways reported full-year earnings of HKD 0.60 per share, in line with management’s prerelease figures. While the market reacted positively to the announcement, presumably due to higher-than-expected supply growth guidance for 2019, we do not believe new supply will be matched by demand in the near term. Our long-term thesis for the carrier remains in place, but we think the first half of 2019 will be a ch...
- Ivan Su
Morningstar | Uncertainties Around Geopolitical Tensions Weigh on Cath...
Our HKD 12.20 fair value estimate and no-moat rating are unchanged after Cathay Pacific Airways reported full-year earnings of HKD 0.60 per share, in line with management’s prerelease figures. While the market reacted positively to the announcement, presumably due to higher-than-expected supply growth guidance for 2019, we do not believe new supply will be matched by demand in the near term. Our long-term thesis for the carrier remains in place, but we think the first half of 2019 will be a ch...
- Ivan Su
Uncertainties Around Geopolitical Tensions Weigh on Cathay’s 2019 Ou...
Our HKD 12.20 fair value estimate and no-moat rating are unchanged after Cathay Pacific Airways reported full-year earnings of HKD 0.60 per share, in line with management’s prerelease figures. While the market reacted positively to the announcement, presumably due to higher-than-expected supply growth guidance for 2019, we do not believe new supply will be matched by demand in the near term. Our long-term thesis for the carrier remains in place, but we think the first half of 2019 will be a ch...
- Ivan Su
Morningstar | Cathay's Potential Acquisitions of HK Airlines and HK Ex...
Cathay Pacific said that it is in talks to acquire shares in both Hong Kong Express and Hong Kong Airlines from HNA Group. While no definitive agreement has been reached at the moment, we think the potential acquisition will not only enlarge Cathay’s footprint in its Hong Kong hub but also expand the airline’s reach into the low-cost carrier, or LCC, market--something we believe is long overdue. With no formal bid being announced, we are maintaining our no-moat rating and fair value estimate...
- Ivan Su
Cathay's Potential Acquisitions of HK Airlines and HK Express Make Str...
Cathay Pacific said that it is in talks to acquire shares in both Hong Kong Express and Hong Kong Airlines from HNA Group. While no definitive agreement has been reached at the moment, we think the potential acquisition will not only enlarge Cathay’s footprint in its Hong Kong hub but also expand the airline’s reach into the low-cost carrier, or LCC, market--something we believe is long overdue. With no formal bid being announced, we are maintaining our no-moat rating and fair value estimate...
- Ivan Su
Morningstar | Despite Cathay's Unexpected Jump in Profit, We Are Maint...
No-moat Cathay Pacific released a profit alert on Feb. 20, guiding a net profit of approximately HKD 2.3 billion versus Morningstar’s estimate of HKD 893 million. This implies the airline made roughly HKD 2.6 billion in the second half of the year. While we applaud the carrier’s efforts in turning profitable after two years of losses, our long-term assumptions for Cathay are unchanged based on this announcement. As a result, we are maintaining our fair value estimate of HKD 12.20 on the oper...
- Ivan Su
Morningstar | Despite Cathay's Unexpected Jump in Profit, We Are Maint...
No-moat Cathay Pacific released a profit alert on Feb. 20, guiding a net profit of approximately HKD 2.3 billion versus Morningstar’s estimate of HKD 893 million. This implies the airline made roughly HKD 2.6 billion in the second half of the year. While we applaud the carrier’s efforts in turning profitable after two years of losses, our long-term assumptions for Cathay are unchanged based on this announcement. As a result, we are maintaining our fair value estimate of HKD 12.20 on the oper...
- Ivan Su
Despite Cathay's Unexpected Jump in Profit, We Are Maintaining FVE at ...
No-moat Cathay Pacific released a profit alert on Feb. 20, guiding a net profit of approximately HKD 2.3 billion versus Morningstar’s estimate of HKD 893 million. This implies the airline made roughly HKD 2.6 billion in the second half of the year. While we applaud the carrier’s efforts in turning profitable after two years of losses, our long-term assumptions for Cathay are unchanged based on this announcement. As a result, we are maintaining our fair value estimate of HKD 12.20 on the oper...
- Ivan Su
Morningstar | New Morningstar Analyst Report for Cathay Pacific Airway...
Cathay Pacific is a premium legacy carrier with an above-average passenger load factor (84%-85%, versus 82%-83% for its key competitors) amid pricing wars and volatile global economic conditions. The company was among the first legacy carriers to roll out premium economy class, which caters to customers that find business class too expensive but are still willing to pay extra for a superior in-flight experience. Despite the historical success, this strategy is facing some headwinds with the late...
- Ivan Su
New Morningstar Analyst Report for Cathay Pacific Airways Ltd
Despite a recent drop in oil price, we maintain our fair value estimate of HKD 12.20 on no-moat Cathay Pacific. The carrier has locked in roughly 30% of its expected fiscal 2019 fuel consumption at Brent price of around USD 65 per barrel. Thus, Cathay is in a less favorable position to benefit from near-term declines in oil price. While shares for the carrier are trading at a 12% discount to our fair value estimate, we recommend investors wait for a larger margin of safety before investing in Ca...
- Ivan Su
Morningstar | Cathay Pacific Remains Fairly Valued Despite Recent Drop...
Despite a recent drop in oil price, we maintain our fair value estimate of HKD 12.20 on no-moat Cathay Pacific. The carrier has locked in roughly 30% of its expected fiscal 2019 fuel consumption at Brent price of around USD 65 per barrel. Thus, Cathay is in a less favorable position to benefit from near-term declines in oil price. While shares for the carrier are trading at a 12% discount to our fair value estimate, we recommend investors wait for a larger margin of safety before investing in Ca...
- Ivan Su
Cathay Pacific Remains Fairly Valued Despite Recent Drop in Oil Price
Despite a recent drop in oil price, we maintain our fair value estimate of HKD 12.20 on no-moat Cathay Pacific. The carrier has locked in roughly 30% of its expected fiscal 2019 fuel consumption at Brent price of around USD 65 per barrel. Thus, Cathay is in a less favorable position to benefit from near-term declines in oil price. While shares for the carrier are trading at a 12% discount to our fair value estimate, we recommend investors wait for a larger margin of safety before investing in Ca...
- Ivan Su
Morningstar | The Worst Is Over for Cathay; FVE Lifted to HKD 12.20
We are raising our fair value estimate for no-moat Cathay Pacific Airways to HKD 12.20 from HKD 11.60 as the company continues to show signs of solid recovery. First-half operating profit was HKD 697 million versus an operating loss of HKD 1,704 million for the year-ago period, above our estimate. Strong passenger yield, at 7.6% year-over-year growth, came on the back of a negligible 0.5% drop in load factor. Cathay’s cargo business (around 24% of overall revenue) remains robust, with revenue ...
- Ivan Su
Morningstar | The Worst Is Over for Cathay; FVE Lifted to HKD 12.20. S...
We are raising our fair value estimate for no-moat Cathay Pacific Airways to HKD 12.20 from HKD 11.60 as the company continues to show signs of solid recovery. First-half operating profit was HKD 697 million versus an operating loss of HKD 1,704 million for the year-ago period, above our estimate. Strong passenger yield, at 7.6% year-over-year growth, came on the back of a negligible 0.5% drop in load factor. Cathay’s cargo business (around 24% of overall revenue) remains robust, with revenue ...
- Ivan Su
The Worst Is Over for Cathay; FVE Lifted to HKD 12.20
We are raising our fair value estimate for no-moat Cathay Pacific Airways to HKD 12.20 from HKD 11.60 as the company continues to show signs of solid recovery. First-half operating profit was HKD 697 million versus an operating loss of HKD 1,704 million for the year-ago period, above our estimate. Strong passenger yield, at 7.6% year-over-year growth, came on the back of a negligible 0.5% drop in load factor. Cathay’s cargo business (around 24% of overall revenue) remains robust, with revenue ...
- Ivan Su
Morningstar | This premium legacy carrier retains a premium load facto...
Cathay Pacific is a premium legacy carrier with an above-average passenger load factor (84%-85%, versus 82%-83% for its key competitors) amid pricing wars and volatile global economic conditions. The company was among the first legacy carriers to roll out premium economy class, which caters to customers that find business class too expensive but are still willing to pay extra for a superior in-flight experience. Despite the historical success, this strategy is facing significant headwinds with t...
- Ivan Su
This premium legacy carrier retains a premium load factor.
No-moat Cathay Pacific’s 2017 net loss of HKD 1.3 billion was better than expected on a mixture of HKD 830 million in one-off disposal gains and strong cargo performance. Excluding the one-offs, the net losses would have beaten our expectation by roughly HKD 300 million, while the 5% year-on-year top-line growth to HKD 97 billion modestly exceeded our estimates. The core passenger operation remained weak, with yield dropping 3.3% in 2017, and the corporate restructuring has yet to generate not...
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