not vested
BOC AVIATION(2588)
Analysis:
The Group announced the interim result in 2019.
Revenue reached USD 930 mn, a YoY increase of 12.8%.
Net profit reached USD 320 mn, up by 8.1% YoY.
As at 30 June 2019, the group has a portfolio of 499 owned, managed and committed aircraft, where 314 aircraft are owned with an average age of 3.1 years and an average remaining lease term of 8.2 years, each weighted by net book value.
Currently, the orderbook had 162 aircraft scheduled for delivery before 2021, but 18 aircraft scheduled for delivery in the first half of 2019 were delayed, including 12 Airbus aircraft delayed primarily due to industrial constraints and six Boeing aircraft delayed primarily due to the 737 MAX grounding.
Moreover, the Group sold 11 aircraft, including two managed aircraft.
The net lease yield dropped 0.2% to 8.4%.
IATA expects this pace to be maintained for the balance of 2019, with 5% passenger traffic growth projected, which should benefit the future performance of the Group.
Strategy:
Buy-in Price: $67.50, Target Price: $73.00, Cut Loss Price: $60.00
Source: Phillips