Stock Name: SIA
Company Name: SINGAPORE AIRLINES LTD
Research House: Daiwa
“We believe yield growth is likely to be supported by the increase in fuel surcharges due to rising jet-fuel prices. However, we do not expect any increase in the yield to mitigate fully the negative impact of rising fuel costs on SIA's bottom line,” the house says.
Daiwa says lackluster passenger and cargo traffic growth in 4Q FY11 may also weigh the stock, and sees few positive share-price catalysts presently. Singapore Airlines is down 0.8% at $14.22.
Company Name: SINGAPORE AIRLINES LTD
Research House: Daiwa
Daiwa cuts Singapore Airlines (C6L.SG) to Hold from Outperform on expectations of higher fuel prices in FY12-FY13, and sluggish 4Q FY11 growth.
The house cuts its six-month target to $15 from $17, after raising its FY12 jet fuel price assumptions by 17% to US$115/bbl($147/bbl), and FY13 forecast by 10% to US$130/bbl.
The house cuts its six-month target to $15 from $17, after raising its FY12 jet fuel price assumptions by 17% to US$115/bbl($147/bbl), and FY13 forecast by 10% to US$130/bbl.
“We believe yield growth is likely to be supported by the increase in fuel surcharges due to rising jet-fuel prices. However, we do not expect any increase in the yield to mitigate fully the negative impact of rising fuel costs on SIA's bottom line,” the house says.
Daiwa says lackluster passenger and cargo traffic growth in 4Q FY11 may also weigh the stock, and sees few positive share-price catalysts presently. Singapore Airlines is down 0.8% at $14.22.
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