Bank of America Securities released a research report stating that it reaffirmed the “buy” rating of Cathay Pacific (00293). Considering the positive performance in the first half of the year, the net profit forecast for 2024 to 2026 was raised by an average of 0.5 billion yuan, and the target price was raised from HK$12 to HK$12.2.
According to the report, Cathay Pacific's performance in the first half of the year was mainly due to lower employee and aircraft parking costs during the period, as well as favorable factors in exchange. The number of available seat kilometers in the first half of the year increased 42.7% year over year, and passenger yield fell 11% year over year, in line with expectations.
Furthermore, Cathay Pacific management expects passenger yield to continue to normalize in the second half of the year. The bank predicts that the passenger yield of the Cathay Pacific brand will fall 10% year on year in the second half of the year, down 1.5% from the first half of the year, and the freight revenue forecast is 23% higher than in the first half of the year.