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Auckland International Airport Ltd (AUKNY)
OTHER OTC:AUKNY
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Auckland International Airport
(OTC:AUKNY)
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Rating:74Outperform
Price Target:
$29.00
▲(18.56% Upside)
Action:ReiteratedDate:02/19/26
The score is driven primarily by strong profitability and a solid balance sheet, reinforced by positive (but not overheated) technical momentum. Earnings-call commentary and narrowed guidance are supportive, while the key constraints are negative free cash flow and a relatively expensive valuation (high P/E and modest yield).
Positive Factors
High profitability margins
Sustained very high operating and EBITDA margins indicate durable cost efficiency and strong pricing/premium commercial mix across aeronautical and non-aeronautical operations. High margins support reinvestment, dividend capacity and resilience through demand cycles over the medium term.
Low financial leverage
Prudent leverage and a strong equity base provide financial flexibility for large infrastructure spending and buffer against shocks. Low net leverage reduces refinancing risk and supports credit metrics, enabling the company to fund capex and navigate regulatory or traffic volatility.
Robust liquidity and fixed-rate debt mix
Material undrawn facilities, cash reserves and a high proportion of fixed-rate borrowings lower refinancing and interest-rate exposure while supporting the heavy capex program. This liquidity profile underpins execution of long-term projects and covenant headroom.
Negative Factors
Negative free cash flow
Persistent negative free cash flow, despite decent operating cash, constrains internal funding for the large NZ$1.0–1.2bn capex program and shareholder returns. Over time it may force increased external financing or deprioritised discretionary spend, raising structural liquidity risk.
Higher depreciation from recent commissioning
Significant recent asset commissioning drives materially higher ongoing depreciation and related non-cash charges, reducing reported profits and return metrics. This converts past capex into permanent cost base pressure, limiting margin upside and earnings flexibility.
Regulatory and tax uncertainty
Ongoing input-methodology, cost-of-capital consultations and potential tax/treatment changes create structural regulatory risk. Altered allowed returns or nondeductibility rules could reduce cash flow predictability and long-term returns on invested capital, impacting strategic planning.
Auckland International Airport (AUKNY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$8.82B
Dividend Yield1.57%
Average Volume (3M)266.00
Price to Earnings (P/E)19.1
Beta (1Y)0.47
Revenue Growth6.16%
EPS Growth7313.59%
CountryUS
Employees754
SectorIndustrials
Sector Strength72
IndustryAirlines, Airports & Air Services
Share Statistics
EPS (TTM)0.28
Shares Outstanding339,025,900
10 Day Avg. Volume0
30 Day Avg. Volume266
Financial Highlights & Ratios
PEG Ratio<0.01
Price to Book (P/B)1.27
Price to Sales (P/S)14.36
P/FCF Ratio-28.79
Enterprise Value/Market Cap1.95
Enterprise Value/Revenue17.12
Enterprise Value/Gross Profit33.55
Enterprise Value/Ebitda21.76
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)0.55
Revenue Forecast (FY)$617.35M
Auckland International Airport Business Overview & Revenue Model
Company DescriptionAuckland International Airport Limited provides airport facilities, supporting infrastructure, and aeronautical services in Auckland, New Zealand. The company operates through three segments: Aeronautical, Retail, and Property. The Aeronautical segment provides services that facilitate the movement of aircraft, passengers, and cargo, as well as utility services, which support the airport; and leases space for facilities, such as terminals. The Retail segment offers services to the retailers within the terminals; and car parking facilities for passengers, visitors, and airport staff. The Property segment leases cargo buildings, hangars, and stand-alone investment properties. The company was founded in 1966 and is based in Manukau, New Zealand.
How the Company Makes MoneyAuckland International Airport generates revenue through several key streams. Primarily, the airport earns money from aeronautical services which include landing fees, terminal charges, and passenger services charges paid by airlines. Additionally, non-aeronautical revenue plays a significant role, derived from retail operations, parking fees, rental properties, and advertising. The airport also benefits from partnerships with airlines and retail brands, enhancing its service offerings and increasing commercial opportunities. These diverse revenue streams, combined with strategic partnerships and investments in infrastructure, contribute to the airport's financial performance.
Auckland International Airport Earnings Call Summary
Earnings Call Date:Feb 18, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Aug 26, 2026
Earnings Call Sentiment Positive
The call presented a largely positive operational and financial picture: underlying trading improved (revenue +4%, EBITDAFI +6%, underlying NPAT +6%), strong cargo growth (+37%), meaningful asset commissioning and clear progress on connectivity and the integrated domestic jet terminal. Management demonstrated cost discipline and maintained robust liquidity. Key risks include retail yield pressures, higher depreciation from recent commissioning, some project complexity causing localized disruption, and external factors such as global fleet shortages and regulatory/tax uncertainty. On balance the positive operational momentum and the strengthened guidance outweigh the setbacks.Q2-2026 Updates
Positive Updates
Revenue and Underlying Profit Growth
1H FY26 revenue rose 4% to just under $520m. Operating EBITDAFI increased 6% to ~$371.3m with EBITDAFI margin up to 71.5% (from just under 70%). Net underlying profit after tax rose 6% to $157.1m.
Strong Aeronautical and Commercial Performance
Aeronautical revenue increased 7% to almost $240m. Commercial revenue grew about 5% overall with notable lifts in car parking (+14% to $41.1m) and investment property rental income (+9%).
Passenger and Cargo Momentum
Total passenger movements rose 2% to 9.64m (domestic 4.37m +2%; international incl. transit 5.27m +2%). International cargo movements nearly 86,000 tonnes and were up 37%, with export value up 75% ($8.2bn) and imports up 19% ($12.1bn).
Operational and Customer Experience Improvements
Customer journey times improved over the peak: median international departure processing 21% faster (6.5 minutes) and arrivals 10% faster (18 minutes). Initiatives include expanded arrivals area, new security screening tech and express pathways.
Major Asset Commissioning and CapEx Progress
CapEx of nearly $431m in H1 with assets commissioned totalling ~$743.5m (~$724m aeronautical). Significant commissioned works included the $465m Northern Airfield expansion and multiple terminal, airfield and stormwater upgrades. Closing WIP was $1.1bn after heavy commissioning.
Progress on Connectivity and Route Recovery
New and returning services bolstering connectivity: China Eastern launched Shanghai–Auckland–Buenos Aires; China market +~50,000 seats FY26 vs FY25; Air New Zealand capacity to Australia +8.4% and Pacific +7.3%; Thai Airways planned resumption (adds ~200,000 seats when operational).
Retail and New Duty-Free Partnership Performing
Retail income $92.3m. PSR up 2% (5% ex-FX). New duty-free partner Lagardere transition smooth; duty-free basket sizes and sales growth outpaced passenger growth despite a challenging retail environment.
Strong Liquidity and Credit Metrics
Drawn debt ~ $2.6bn, undrawn facilities >$1bn and cash reserves $361m. ~87% of borrowings fixed. FFO-to-interest and FFO-to-net-debt metrics remain comfortably above covenant tests.
Narrowed and Positive FY26 Outlook
Management narrowed guidance: underlying profit after tax guidance to $295m–$320m, CapEx guidance narrowed to $1.0bn–$1.2bn, and passenger forecasts (domestic ~8.6m; international ~10.6m). Management expressed optimism based on trading momentum and connectivity pipeline.
Negative Updates
Reported Profit Impacted by Revaluations
Total reported profit after tax fell 5% to $177m, largely due to lower investment property revaluations compared with the prior period.
Retail Yield and Mix Pressures
Retail income declined 2% despite higher sales; income per passenger fell 4% due to lower concession yields, promotional activity and a shift in sales mix toward lower-margin categories (technology). Luxury and FX sales remained weak.
Rising Depreciation and Commissioning-related Costs
Depreciation increased over $19m (+20%) reflecting recent asset commissioning. Accelerated depreciation ($2m) was recorded for assets shortened or decommissioned as part of the aeronautical program.
Project Complexity and Localised Disruption
Large-scale infrastructure works created complexity: ~60,000 sqm of airfield temporarily closed for construction, temporary check-in changes planned and some construction-related disruption and lumpy OpEx expected as works ramp up.
Domestic Corporate Demand Weakness and Parking Impacts
Domestic car park exits fell 7% (loss of ~700 spaces due to regional airfield expansion and weaker corporate demand), partially offset by stronger premium and Park & Ride performance.
Slower Investment Property Activity
Softer market conditions reduced expected investment property activity in H1 despite a 9% rental income uplift; longer-term commercial CapEx expected to average $100m–$150m but near-term activity was subdued.
Fleet Availability and Capacity Constraints
Management flagged ongoing global fleet shortages that will continue to weigh on seat capacity availability and pace of international capacity growth in the near term.
Regulatory and Tax Uncertainties
High Court declined appeals on airport input methodologies and the Commerce Commission is consulting on cost-of-capital amendments; government policy changes (e.g., nondeductibility of building depreciation) and potential input methodology changes introduce regulatory and tax uncertainty.
Company Guidance
Auckland Airport narrowed its FY26 guidance to underlying profit after tax of NZ$295–320 million, with passenger forecasts of circa 8.6 million domestic and circa 10.6 million international travellers and capital expenditure trimmed to NZ$1.0–1.2 billion; management said depreciation plus net interest is targeted around NZ$300 million (possibly 2–5% higher), operating expenses may rise in the second half by low single-digit dollars while management aims to reduce unit cost-to-serve, and the tax rate is expected to trend toward ~28%. The company reiterated return-to-shareholder metrics with an interim dividend of NZ$0.065 per share (DRP available at a 2.5% discount and >40% participation historically) and noted upside — including reaching the top half of the profit range — if passenger forecasts are achieved, while all guidance remains subject to material adverse events and program execution risks.Auckland International Airport Financial Statement Overview
Summary
Strong income statement performance (revenue growth and very high profitability margins) and a healthy balance sheet with low leverage support the score. Offsetting this, cash flow quality is weaker due to negative free cash flow and the balance sheet notes relatively low return on equity.Income Statement
Auckland International Airport has shown strong revenue growth of 7.62% in the latest year, with impressive gross and net profit margins of 100% and 45.27% respectively. The EBIT and EBITDA margins are also robust at 67.42% and 89.01%, indicating efficient operations. However, the significant increase in net income from the previous year suggests potential volatility.85
Very Positive
Balance Sheet
The company maintains a healthy debt-to-equity ratio of 0.24, reflecting prudent financial leverage. The equity ratio stands at 74.48%, indicating a strong equity base. However, the return on equity is relatively low, suggesting room for improvement in generating returns on shareholders' investments.78
Positive
Cash Flow
Operating cash flow remains positive, but the company faces challenges with negative free cash flow, which has improved slightly by 16.20%. The operating cash flow to net income ratio is 0.75, indicating decent cash generation relative to net income. However, the negative free cash flow to net income ratio highlights potential liquidity concerns.65
Positive
| Breakdown | TTM | Jun 2025 | Jun 2024 | Jun 2023 | Jun 2022 | Jun 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 1.00B | 929.30M | 836.70M | 622.70M | 300.00M | 276.20M |
| Gross Profit | 512.78M | 929.30M | 660.40M | 292.50M | 49.20M | 169.40M |
| EBITDA | 790.71M | 827.20M | 584.10M | 252.20M | 336.40M | 149.30M |
| Net Income | 412.65M | 420.70M | 5.50M | 43.20M | 191.60M | 464.20M |
Balance Sheet | ||||||
| Total Assets | 14.27B | 14.06B | 12.42B | 10.83B | 10.18B | 9.82B |
| Cash, Cash Equivalents and Short-Term Investments | 360.17M | 567.80M | 219.70M | 107.80M | 24.70M | 79.50M |
| Total Debt | 2.65B | 2.49B | 2.68B | 1.82B | 1.48B | 1.39B |
| Total Liabilities | 3.70B | 3.59B | 3.81B | 2.45B | 2.03B | 1.89B |
| Stockholders Equity | 10.57B | 10.47B | 8.61B | 8.38B | 8.15B | 7.93B |
Cash Flow | ||||||
| Free Cash Flow | -428.82M | -463.50M | -350.90M | -157.60M | -128.60M | -82.40M |
| Operating Cash Flow | 418.15M | 474.30M | 496.30M | 307.50M | 96.20M | 59.10M |
| Investing Cash Flow | -884.31M | -1.11B | -1.12B | -578.00M | -278.20M | -214.60M |
| Financing Cash Flow | 359.71M | 979.00M | 741.20M | 352.00M | 127.20M | -530.30M |
Auckland International Airport Technical Analysis
Positive
24.46
Price Trends
25.09
Positive
24.04
Positive
23.39
Positive
Market Momentum
0.57
Positive
58.03
Neutral
37.26
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AUKNY, the sentiment is Positive. The current price of 24.46 is below the 20-day moving average (MA) of 26.16, below the 50-day MA of 25.09, and above the 200-day MA of 23.39, indicating a bullish trend. The MACD of 0.57 indicates Positive momentum. The RSI at 58.03 is Neutral, neither overbought nor oversold. The STOCH value of 37.26 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for AUKNY.
Auckland International Airport Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
79 Outperform | $5.48B | 17.70 | 49.49% | 4.03% | -2.04% | -3.82% | |
74 Outperform | $8.82B | 19.13 | 4.28% | 1.57% | 6.16% | 7313.59% | |
71 Outperform | $4.26B | 13.32 | 13.25% | ― | 14.87% | -47.71% | |
69 Neutral | $10.17B | 16.66 | 22.64% | 11.85% | 8.70% | -21.15% | |
65 Neutral | $12.33B | 23.99 | 42.68% | 4.46% | 11.58% | 1.15% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% |
* Industrials Sector Average
AUKNY
Auckland International Airport
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2.86
12.39%
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ASR
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CAAP
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Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.