Singapore Airlines (SIA) Earnings: S$451.7M Net Income in 1Q with Strong Passenger Load Factor

Singapore Airlines on Smartkarma

Analyst coverage of Singapore Airlines on Smartkarma reveals a bearish sentiment from Neil Glynn. In the report “Singapore Airlines – 4Q Likely to Extend the Theme of Earnings Normalization as FY25 Comes into View,” Glynn emphasizes the expectation of further earnings normalization in the fourth quarter of 2024. Highlighting that earnings are normalizing down from peak levels, the forecast for FY25 operating profits is around 20% below consensus. With inflationary pressures impacting the airline, Singapore Airlines is anticipated to report a disappointing 4Q24 as the trend of earnings normalization continues.

In another report by Neil Glynn titled “Singapore Airlines – Onset of Earnings Normalization to Heighten Focus on Efficiency,” a deep dive into SIA’s cost control and journey towards “normalised” earnings is provided. Glynn notes that SIA’s cost control lags behind key APAC peers and highlights concerns about inflation levels relative to competitors. The report indicates a reduction in operating profit forecasts for FY24 and FY25, emphasizing the need for enhanced efficiency amidst the ongoing capacity restoration. Overall, these insights underscore a challenging period for Singapore Airlines as it navigates through the impacts of inflation and strives for improved cost management strategies.

A look at Singapore Airlines Smart Scores

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, Singapore Airlines is positioned for a promising long-term outlook. With a solid score of 5 in Growth, the company is expected to expand and develop over time. This is complemented by high scores in Resilience and Momentum, both at 4, indicating a strong ability to weather challenges and maintain positive performance trends. Additionally, with a score of 4 in Dividend, investors can potentially benefit from steady payouts. While the company scores moderately in Value at 3, its overall outlook appears positive, especially with a strong emphasis on growth.

Summary: Singapore Airlines Limited is a comprehensive air transportation company that operates across various regions globally, providing a range of services including engineering, pilot training, air charter, and tour wholesaling. With a diversified airline operation covering major continents, the company’s high Smart Scores in Growth, Resilience, Dividend, and Momentum suggest a favorable long-term prospect for investors seeking opportunities in the aviation sector.

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