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Air China (UK) (HK:0753)
:0753
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Air China (0753) AI Stock Analysis

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HK

Air China

(LSE:0753)

Rating:52Neutral
Price Target:
HK$5.50
▲(2.80%Upside)
The overall stock score for Air China reflects a cautious outlook, driven primarily by its weak financial performance characterized by ongoing losses and high leverage. While technical analysis suggests some positive momentum, the negative valuation metrics due to unprofitability weigh heavily on the stock's attractiveness. Investors should consider the risks associated with the company's current financial and operational challenges.
Positive Factors
Global Connectivity
As part of the Star Alliance group, Air China has a key advantage in global connectivity, commanding a 27% share of China's total international traffic in 2019.
Operating Margins
Lower jet fuel prices and weaker USD set to provide a significant lift to operating margins.
Travel Demand
Robust Labour Day travel data points to firming demand and a more constructive near-term outlook.
Negative Factors
Earnings Pressure
Persistent pressure on passenger yields in both the domestic and international segments are set to weigh on Air China’s earnings amid macroeconomic uncertainties and weak consumer sentiment.
Macroeconomic Headwinds
Macroeconomic headwinds and diversion to high-speed rail could curtail the recovery in passenger traffic and keep a lid on yields.
Valuations
Elevated valuations limit further upside to share price.

Air China (0753) vs. iShares MSCI Hong Kong ETF (EWH)

Air China Business Overview & Revenue Model

Company DescriptionAir China Limited (0753) is one of the major airlines in the People's Republic of China. It operates in the air transportation sector, providing both passenger and cargo air services. Air China is known for offering domestic and international flights, with a network spanning several continents, including Asia, Europe, North America, and Oceania. The company also provides related services such as aircraft maintenance and aviation-related ground handling services.
How the Company Makes MoneyAir China generates revenue primarily through its passenger and cargo transportation services. The company's key revenue streams include ticket sales for domestic and international flights, fees for excess baggage, and in-flight sales such as food and duty-free products. Cargo services also contribute significantly to its earnings, with revenues derived from the transportation of goods and freight services. Additionally, Air China benefits from strategic partnerships and alliances, such as its membership in the Star Alliance network, which expands its code-sharing and customer reach. Ancillary services, including aircraft maintenance and ground services, also provide supplementary income streams, adding to the overall financial performance of the company.

Air China Financial Statement Overview

Summary
Air China's financial performance exhibits mixed signals. While revenue growth is evident, profitability remains elusive with ongoing net losses. The high leverage on the balance sheet poses financial risk, though some improvement in equity ratio is noted. Cash flow challenges persist, especially with negative free cash flow, underscoring the need for strategic financial management to enhance liquidity and reduce debt levels. Overall, the financials suggest caution due to operational inefficiencies and financial risks.
Income Statement
45
Neutral
Air China has experienced fluctuating revenue with a notable increase in recent years, yet it remains plagued by persistent net losses and negative EBIT margins, indicating operational challenges. The gross profit margin has slightly improved, but the company's inability to achieve net profitability continues to weigh down its financial performance.
Balance Sheet
50
Neutral
The balance sheet of Air China shows high leverage with a significant debt-to-equity ratio, reflecting financial risk. However, the company's equity ratio has improved over time, suggesting a strengthening of the equity base relative to its assets. The ongoing liabilities and debt levels remain a concern for long-term stability.
Cash Flow
40
Negative
Air China's cash flow statement highlights inconsistent cash generation, with significant variations in free cash flow growth rates. Operating cash flow has been positive recently, but free cash flow remains negative due to high capital expenditures, indicating potential liquidity constraints.
BreakdownDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue166.70B141.10B52.90B74.53B69.50B
Gross Profit8.51B7.09B-29.91B-11.31B-6.13B
EBITDA33.90B32.40B-18.16B4.61B7.05B
Net Income-237.31M-1.05B-45.18B-18.83B-15.82B
Balance Sheet
Total Assets345.77B335.30B295.01B298.42B284.07B
Cash, Cash Equivalents and Short-Term Investments22.51B15.63B11.44B16.71B6.58B
Total Debt162.86B175.39B214.18B182.87B159.63B
Total Liabilities304.82B300.01B273.45B232.55B200.26B
Stockholders Equity45.15B37.23B23.61B61.40B77.58B
Cash Flow
Free Cash Flow14.44B12.65B-24.40B6.81B-10.63B
Operating Cash Flow34.55B35.42B-16.76B12.89B1.41B
Investing Cash Flow-17.86B-15.25B-6.87B-4.45B-15.87B
Financing Cash Flow-10.56B-15.85B18.10B1.71B11.46B

Air China Technical Analysis

Technical Analysis Sentiment
Neutral
Last Price5.35
Price Trends
50DMA
5.57
Negative
100DMA
5.24
Positive
200DMA
4.91
Positive
Market Momentum
MACD
-0.05
Positive
RSI
39.12
Neutral
STOCH
14.86
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:0753, the sentiment is Neutral. The current price of 5.35 is below the 20-day moving average (MA) of 5.63, below the 50-day MA of 5.57, and above the 200-day MA of 4.91, indicating a neutral trend. The MACD of -0.05 indicates Positive momentum. The RSI at 39.12 is Neutral, neither overbought nor oversold. The STOCH value of 14.86 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for HK:0753.

Air China Peers Comparison

Overall Rating
UnderperformOutperform
Sector (58)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
79
Outperform
HK$76.50B7.9617.64%8.25%10.46%5.94%
58
Neutral
HK$21.47B24.49-16.35%14.66%7.50%-107.03%
54
Neutral
HK$86.08B-9.88%14.25%
52
Neutral
HK$130.19B-1.68%16.27%64.19%
42
Neutral
HK$100.63B-4.92%7.08%
* General Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
HK:0753
Air China
5.35
1.79
50.28%
HK:0670
China Eastern Airlines Corporation Limited Class H
2.94
0.92
45.54%
HK:1055
China Southern Airlines Company Limited Class H
3.64
0.78
27.27%
HK:0293
Cathay Pacific Airways
11.96
4.53
60.97%

Air China Corporate Events

Air China Reports Growth in June 2025 Traffic and Expands Route Network
Jul 15, 2025

Air China Limited reported an increase in passenger and cargo traffic for June 2025, with international routes showing significant growth. The company also expanded its route offerings by adding new flights and adjusted its fleet composition, indicating a strategic focus on optimizing operations and enhancing service capacity.

The most recent analyst rating on (HK:0753) stock is a Buy with a HK$5.90 price target. To see the full list of analyst forecasts on Air China stock, see the HK:0753 Stock Forecast page.

Air China Projects Significant Losses Amid Industry Challenges
Jul 14, 2025

Air China Limited has issued a profit warning for the first half of 2025, projecting a net loss between RMB1.7 billion and RMB2.2 billion, despite efforts to improve operational performance and reduce losses year-on-year. The company attributes the continued losses to challenges such as imbalanced market supply, competition from high-speed rail, and global economic uncertainties, which have impacted its ability to return to profitability.

The most recent analyst rating on (HK:0753) stock is a Buy with a HK$5.90 price target. To see the full list of analyst forecasts on Air China stock, see the HK:0753 Stock Forecast page.

Air China Approves Key Resolutions at 2024 AGM
Jun 24, 2025

Air China Limited announced the successful passage of all resolutions at its 2024 Annual General Meeting, including the abolishment of the Supervisory Committee. This decision, along with the approval of other key resolutions such as financial statements and auditor appointments, reflects the company’s strategic adjustments and governance restructuring, potentially impacting its operational efficiency and stakeholder relations.

The most recent analyst rating on (HK:0753) stock is a Hold with a HK$5.10 price target. To see the full list of analyst forecasts on Air China stock, see the HK:0753 Stock Forecast page.

Air China Reports Growth in Passenger and Cargo Traffic for May 2025
Jun 13, 2025

In May 2025, Air China Limited reported a significant increase in passenger traffic, with a year-on-year rise of 8.4% in revenue passenger kilometers. The company also saw improvements in passenger capacity and load factors across domestic, international, and regional routes. Cargo operations experienced growth as well, with a 6.2% increase in cargo and mail traffic. The introduction of a new route between Beijing Capital and Toronto and the addition of new aircraft to their fleet highlight Air China’s ongoing expansion efforts.

The most recent analyst rating on (HK:0753) stock is a Buy with a HK$5.90 price target. To see the full list of analyst forecasts on Air China stock, see the HK:0753 Stock Forecast page.

Air China Announces AGM and Debt Issuance Plans
Jun 3, 2025

Air China Limited has announced its upcoming Annual General Meeting (AGM) scheduled for June 24, 2025, where several key resolutions will be discussed. These include the approval of the 2024 work reports, financial statements, profit distribution, and the appointment of auditors. Additionally, the company plans to issue debt financing instruments to support its financial strategies, which may impact its market positioning and stakeholder interests.

The most recent analyst rating on (HK:0753) stock is a Buy with a HK$5.90 price target. To see the full list of analyst forecasts on Air China stock, see the HK:0753 Stock Forecast page.

Air China Renews CNACG Framework Agreement for 2026-2028
May 28, 2025

Air China has announced the renewal of its CNACG Framework Agreement for a three-year term from January 2026 to December 2028, subject to approval by Independent Shareholders at the AGM. This renewal indicates the continuation of connected transactions with CNACG, which are subject to various Hong Kong Listing Rules requirements. The renewal is expected to maintain Air China’s operational collaborations and financial arrangements with CNACG, impacting its leasing and service agreements.

The most recent analyst rating on (HK:0753) stock is a Buy with a HK$5.90 price target. To see the full list of analyst forecasts on Air China stock, see the HK:0753 Stock Forecast page.

Air China Proposes Governance Overhaul and Enhances Shareholder Rights
May 28, 2025

Air China Limited has announced proposed amendments to its Articles of Association and the abolishment of the Supervisory Committee, with the Audit and Risk Management Committee assuming its functions. These changes aim to enhance shareholder rights, adjust the powers of the shareholders’ meeting and the Board, and update the company’s governance structure in line with the latest regulations. The proposed amendments are subject to approval at the 2024 annual general meeting, reflecting the company’s efforts to streamline operations and strengthen minority shareholder protections.

The most recent analyst rating on (HK:0753) stock is a Buy with a HK$5.90 price target. To see the full list of analyst forecasts on Air China stock, see the HK:0753 Stock Forecast page.

Air China Enhances Governance with New Nomination Committee
May 28, 2025

Air China Limited has established a Nomination Committee as part of its Board of Directors to enhance its corporate governance structure. This committee is responsible for advising on the selection criteria and procedures for directors and senior management, ensuring board diversity, and making recommendations on appointments and succession planning. The committee’s formation is expected to strengthen the company’s strategic alignment and operational efficiency.

The most recent analyst rating on (HK:0753) stock is a Buy with a HK$5.90 price target. To see the full list of analyst forecasts on Air China stock, see the HK:0753 Stock Forecast page.

Air China Reports Growth in Passenger and Cargo Traffic for April 2025
May 15, 2025

Air China Limited reported a significant increase in passenger traffic and capacity for April 2025, with notable growth in international routes. The company also expanded its cargo operations and introduced new flight routes, enhancing its operational footprint and potentially strengthening its market position.

The most recent analyst rating on (HK:0753) stock is a Buy with a HK$5.90 price target. To see the full list of analyst forecasts on Air China stock, see the HK:0753 Stock Forecast page.

Air China Postpones Annual General Meeting and Adjusts Key Dates
May 6, 2025

Air China Limited has announced the postponement of its Annual General Meeting (AGM), originally scheduled for May 28, 2025, to a later date in June 2025. Consequently, the previously set book closure period and record date for the AGM have been canceled, with new dates to be announced. This postponement may affect stakeholders awaiting resolutions and decisions typically addressed during the AGM.

Air China Reports Increased Losses in Q1 2025
Apr 29, 2025

Air China Limited has released its first quarterly report for 2025, showing a slight decrease in revenue by 0.11% compared to the same period last year, totaling RMB 40,023,324. The company reported a net loss attributable to shareholders of RMB 2,043,993, marking a 22.07% increase in losses from the previous year. Additionally, net cash flows from operating activities decreased by 11.33%. These financial results indicate challenges in improving profitability and cash flow, impacting the company’s financial health and market position.

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.Date of analysis: Jun 05, 2025