- Cathay Pacific reported a passenger load factor of 85.8% in October, indicating high passenger occupancy on their flights.
- The airline transported 2.60 million passengers during the month.
- Cargo operation showed a load factor of 60.3%, highlighting significant cargo transportation.
- HK Express, a subsidiary, carried 683,476 passengers, with a load factor of 76.5%.
- Cathay Pacific noted strong bookings for the upcoming Christmas travel season, particularly from North America, the UK, and Europe, driven by individuals visiting friends and family.
- Cathay Cargo expects demand to remain robust through the rest of the cargo peak season, especially on major trade routes.
- HK Express is focusing on monitoring and stimulating travel demand, especially towards Japan.
- The market analysis includes 5 buy recommendations, 6 hold recommendations, and 4 sell recommendations for related stocks.
Cathay Pacific Airways on Smartkarma
Analysts on Smartkarma are optimistic about Cathay Pacific Airways following the recent buyback of Qatar Airways’ stake. Osbert Tang, CFA, believes this move will positively impact Cathay’s earnings per share and return on equity for FY26 and FY27, potentially leading to a re-inclusion in the HSI index. Tang suggests that with passenger numbers rebounding, the current earnings forecasts may be too conservative, indicating room for upward surprises. The company’s improved financial outlook could drive a significant upside potential, with potential to trade up to 1.65x P/B, representing over 30% increase from current levels.
David Blennerhassett also sees the buyback as a positive development, estimating a substantial boost to Cathay’s EPS. While he views this as a favorable opportunity, he notes that it is not a high conviction trade. The acquisition of Qatar Airways’ stake for HK$6.96 billion marks a strategic move that reshapes Cathay’s ownership structure, with Swire Pacific and Air China seeing their stakes in the airline increase as a result of the transaction.
A look at Cathay Pacific Airways Smart Scores
| Factor | Score | Magnitude |
|---|---|---|
| Value | 3 | |
| Dividend | 4 | |
| Growth | 5 | |
| Resilience | 3 | |
| Momentum | 4 | |
| OVERALL SMART SCORE | 3.8 |
Smart Score is a compound score for the Company indicating its overall outlook. It is derived by taking an equally weighted average of underlying Factor scores computed by Smartkarma
Based on the Smartkarma Smart Scores, Cathay Pacific Airways seems to have a positive long-term outlook. With a high score of 5 in Growth, the company is expected to expand and develop over time. Additionally, a score of 4 in Dividend suggests that investors may receive good returns through dividends. Momentum, rated at 4, indicates that the company is likely to continue performing well in the future. However, with Value and Resilience scores of 3, there may be some room for improvement in terms of the company’s overall value and ability to withstand economic challenges.
Cathay Pacific Airways Limited, known for its scheduled airline services and related offerings such as airline catering and aircraft handling, appears to be in a strong position for growth and dividend payouts. While the company displays positive momentum, ensuring its value and increasing resilience could further enhance its long-term prospects in the competitive aviation industry.
Disclaimer: This article by Smartkarma is general in nature and based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Note that our articles may not factor in the latest price-sensitive company announcements or qualitative material.
While all reasonable care has been taken in the preparation, Smartkarma makes no assurance about the accuracy of any generated data or content. All content is indicative only and should be independently checked for accuracy and confirmed before use. Smartkarma accepts no responsibility for any loss or damage caused as a result of any inaccuracy or error within the Lab online tools or generated data.
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