Air China (AIRYY) AI Stock Analysis

• Market Cap: $19.69B
• Dividend Yield: N/A
• Average Volume (3M): 211.00
• Price to Earnings (P/E): 164.2
• Beta (1Y): 0.78
• Revenue Growth: 4.48%
• EPS Growth: N/A
• Country: US
• Employees: 104,909
• Sector: Industrials
• Sector Strength: 72
• Industry: Airlines, Airports & Air Services
• EPS (TTM): 0.62
• Shares Outstanding: 247,780,530
• 10 Day Avg. Volume: 85
• 30 Day Avg. Volume: 211
• PEG Ratio: 4.13
• Price to Book (P/B): 1.71
• Price to Sales (P/S): 0.46
• P/FCF Ratio: 5.36
• Enterprise Value/Market Cap: 11.36
• Enterprise Value/Revenue: 1.33
• Enterprise Value/Gross Profit: 25.22
• Enterprise Value/Ebitda: 34.07
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 43 Neutral
• Price Target: $3.00 ▼(-81.31% Downside)

The score is primarily weighed down by weak financial performance—ongoing losses and strained cash generation despite revenue recovery—alongside high leverage. Technical signals are also negative (MACD below zero and very low RSI), while valuation is least supportive given the very high P/E and no dividend yield provided.

Positive Factors

Network & alliance strength

As China’s flag carrier with an extensive domestic and international network and Star Alliance membership, Air China benefits from durable feed, interline connectivity and corporate account access. These structural distribution advantages support sustained passenger and cargo volumes over months.

Revenue recovery

Reported revenue recovery indicates demand normalization and restores scale in operations. Sustained top-line improvement can unlock unit cost leverage, improve load factors and provide a platform for restoring margins if matched by disciplined capacity and yield management over the medium term.

Government support

Explicit government support and subsidies offer structural downside protection in downturns, aiding liquidity access and strategic route backing. For a capital-intensive national carrier, such support can materially lower refinancing and operational stress risks across economic cycles.

Negative Factors

High leverage

Air China’s elevated debt relative to equity leaves the carrier exposed to interest-cost volatility and refinancing risk. In a capital-intensive industry, constrained equity backing reduces financial flexibility for fleet investment and weakens resilience to sustained demand shocks over the medium term.

Continued unprofitability

Persistent negative EBIT/EBITDA and ongoing losses erode retained capital and limit the company’s ability to internally fund fleet renewal or strategic investments. Long-term recovery depends on structural margin restoration, not just revenue, to achieve sustainable profitability and reduce external financing needs.

Weak cash generation

Declining operating cash flow and negative free cash flow driven by high capex pressure liquidity and limit debt reduction. For an asset-heavy airline, sustained weak cash generation forces reliance on external funding and can delay necessary maintenance or growth investments over the medium term.

Air China Business Overview & Revenue Model

Company Description

Air China (AIRYY) is the flag carrier and one of the major airlines of the People's Republic of China, operating both domestic and international flights. Established in 1988, the airline is headquartered in Beijing and serves as a key player in the aviation industry, offering passenger and cargo transport services. Air China is known for its extensive network connecting China to various global destinations, providing a range of services including economy, business, and first-class travel options, as well as cargo services.

How the Company Makes Money

Air China generates revenue primarily through the sale of passenger tickets for domestic and international flights, which constitutes a significant portion of its income. Additionally, the airline earns money from cargo services, transporting goods and freight on its flights. Ancillary revenue streams include fees from extra services such as baggage handling, in-flight sales, and seat selection. Partnerships with other airlines and participation in global airline alliances, such as Star Alliance, enhance its reach and customer base, contributing to increased sales. Furthermore, Air China benefits from government support and subsidies, which can also play a role in its overall profitability.

Air China Financial Statement Overview

Summary

Air China is facing financial challenges with negative net profit margins and high leverage. Despite revenue growth, profitability and cash flow issues remain significant concerns.

Income Statement

Air China has faced challenges in achieving profitability, as reflected in negative net profit margins over the recent periods. Despite a substantial recovery in revenue from 2022 to 2023, the company still operates at a loss, with negative EBIT and EBITDA margins. However, the revenue growth is a positive sign, indicating potential recovery momentum.

Balance Sheet

The balance sheet shows a high level of debt relative to equity, indicating significant leverage, which is common in the airline industry but poses risks. The equity ratio is relatively low, suggesting limited asset backing by equity. However, the company's net debt has decreased over the past year, indicating improving financial stability.

Cash Flow

The cash flow analysis reveals a decline in free cash flow, primarily due to high capital expenditures. Operating cash flow has decreased significantly year-on-year, and the free cash flow to net income ratio is negative, highlighting cash flow challenges. The company needs to improve its cash generation to sustain operations and reduce debt.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	167.94B	166.70B	141.10B	52.90B	74.53B	69.50B
Gross Profit	8.87B	8.51B	7.09B	-29.91B	-11.31B	-6.13B
EBITDA	6.56B	33.90B	32.40B	-18.16B	4.61B	7.05B
Net Income	739.51M	-237.31M	-1.05B	-38.62B	-16.64B	-14.41B
Balance Sheet
Total Assets	347.56B	345.77B	335.30B	295.01B	298.42B	284.07B
Cash, Cash Equivalents and Short-Term Investments	28.08B	22.51B	15.63B	11.44B	16.71B	6.58B
Total Debt	171.91B	162.86B	175.39B	214.18B	182.87B	159.63B
Total Liabilities	309.31B	304.82B	300.01B	273.45B	232.55B	200.26B
Stockholders Equity	42.64B	45.15B	37.23B	23.61B	61.40B	77.58B
Cash Flow
Free Cash Flow	792.75M	14.44B	12.65B	-24.40B	6.81B	-10.63B
Operating Cash Flow	17.83B	34.55B	35.42B	-16.76B	12.89B	1.41B
Investing Cash Flow	-17.02B	-17.86B	-15.25B	-6.87B	-4.45B	-15.87B
Financing Cash Flow	-12.22B	-10.56B	-15.85B	18.10B	1.71B	11.46B

Air China Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 16.05
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AIRYY, the sentiment is Positive. The current price of 16.05 is below the 20-day moving average (MA) of 17.98, below the 50-day MA of 16.94, and above the 200-day MA of 14.39, indicating a neutral trend. The MACD of 0.33 indicates Positive momentum. The RSI at 54.60 is Neutral, neither overbought nor oversold. The STOCH value of -0.10 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for AIRYY.

Air China Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
RYAAY	83 Outperform	$35.10B	13.17	28.67%	1.37%	14.75%	71.73%
UAL	74 Outperform	$36.74B	11.37	25.59%	―	4.24%	20.29%
DAL	73 Outperform	$45.99B	9.19	27.78%	0.96%	4.33%	-1.58%
LTM	72 Outperform	$16.78B	14.22	135.74%	3.50%	6.81%	58.22%
AAL	64 Neutral	$10.15B	18.48	―	―	1.27%	118.64%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
AIRYY	43 Neutral	$19.69B	164.22	1.93%	―	4.48%	―