A rebound in travel activities, following the easing of COVID-19 restrictions, has given a boost to Air Canada’s (TSE: AC) recent performance. Before going any further, it is important to understand that the stock is currently trading near its 52-week low price of C$18.42, which could be a good entry point for investors looking to gain exposure to the stock.
At the beginning of this month, the airline reported strong quarterly results for the first time since the onset of the COVID-19 pandemic.
Here’s a Snapshot of Air Canada’s Q2 Results
Operating revenues grew five times year-over-year to C$3.981 billion, and passenger revenues rose almost eight times to C$3.441 billion.
EBITDA totaled C$154 million, compared to a negative C$656 million in the second quarter of last year.
Net loss narrowed to C$1.60 per share from C$3.31 per share reported in the year-ago quarter. It was, however, wider than the Street’s expectation of 87 cents per share.
The President and CEO of Air Canada, Michael Rousseau, said, “We safely transported over 9.1 million customers in the quarter, nearly eight million more than the second quarter of 2021 or about 70% of total customers carried in the full year 2021… In the second quarter, our operating capacity, measured by available seat miles (ASM) was 73% of the same quarter in 2019, and despite the lower capacity, passenger revenues were 80% of those generated in the second quarter of 2019, driven by higher yields.”
The Quebec-based company expects to increase its ASM capacity by nearly 131% year-over-year in the third quarter. It anticipates the figure to stand at around 79% of the ASM capacity in the third quarter of 2019.
For full-year 2022, Air Canada projects EBITDA margin to be about 8% to 11%, and ASM capacity to be almost 150% of 2021 levels and 74% of 2019 ASM capacity.
Air Canada’s Website Traffic Trends Hinted at a Solid Q2 Show
According to TipRanks’ Website Traffic Tool, Air Canada’s website traffic registered a 32.3% rise in global visits during the second quarter, compared to the first quarter. Website visits on the desktop grew 24.5% quarter-over-quarter, and the footfall on the company’s mobile app climbed 38.7%.
Interestingly, Air Canada’s website traffic trends support the jump witnessed in the company’s operating revenues. Learn how Website Traffic can help you research your favorite stocks.
Is Air Canada a Buy or Sell?
As of now, Air Canada stock seems to be emitting positivity. As per TipRanks, financial bloggers and insiders look positive about the prospects of the company, which has a market cap of C$5.21 billion. While the bloggers are 100% bullish on the stock, compared to the sector average of 67%, corporate insiders have bought Air Canada’s shares worth $67.8K in the last three months.
Meanwhile, analysts share a similar sentiment but are cautious in their approach. According to TipRanks, analysts have a Moderate Buy consensus rating on Air Canada, which is based on eight Buys and three Holds. Air Canada’s average price target of C$25.63 implies upside potential of approximately 39%, according to TipRanks.
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