BOC Aviation (2588) AI Stock Analysis

• Market Cap: HK$50.66B
• Dividend Yield: 4.44%
• Average Volume (3M): 816.55K
• Price to Earnings (P/E): 8.1
• Beta (1Y): 0.31
• Revenue Growth: 1.58%
• EPS Growth: -16.66%
• Country: HK
• Employees: 204
• Sector: Industrials
• Sector Strength: 72
• Industry: Rental & Leasing Services
• EPS (TTM): 3.81
• Shares Outstanding: 694,010,300
• 10 Day Avg. Volume: 781,872
• 30 Day Avg. Volume: 816,546
• PEG Ratio: 0.28
• Price to Book (P/B): 0.85
• Price to Sales (P/S): 2.45
• P/FCF Ratio: 57.08
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: HK$85.98
• Price Target Upside: 17.78% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 3
• EPS Forecast (FY): 8.13
• Revenue Forecast (FY): HK$19.24B

• Rating: 73 Outperform
• Price Target: HK$77.00 ▲(5.48% Upside)

BOC Aviation's overall stock score reflects strong financial performance and attractive valuation. The company's robust cash flow management and profitability are significant strengths. However, technical indicators suggest caution in the short term, with the stock trading below key moving averages. The absence of recent earnings call data and corporate events limits additional insights.

Positive Factors

Revenue Growth

BOC Aviation's steady revenue growth reflects its strong market position and effective business model, ensuring long-term financial stability.

Cash Flow Management

Improved cash flow management enhances financial flexibility, enabling BOC Aviation to invest in growth opportunities and manage debt efficiently.

Profitability Margins

Enhanced profitability margins indicate BOC Aviation's operational efficiency and ability to convert revenue into profit, supporting sustainable growth.

Negative Factors

High Leverage

Substantial leverage poses a risk to financial stability, potentially limiting BOC Aviation's ability to weather economic downturns or invest in expansion.

Earnings Per Share Decline

A decline in earnings per share suggests challenges in maintaining profitability per share, which could affect investor confidence and share value over time.

Equity Financing

While moderate equity financing is positive, reliance on debt over equity can increase financial risk, impacting long-term financial health.

BOC Aviation Business Overview & Revenue Model

Company Description

BOC Aviation (2588) is a leading global aircraft leasing company headquartered in Singapore. It is a wholly-owned subsidiary of Bank of China and specializes in the acquisition and leasing of commercial aircraft to airlines worldwide. The company operates in the aviation finance sector and offers a comprehensive range of services including operating leases, finance leases, and sale and leaseback arrangements. Its extensive fleet includes a diverse portfolio of modern aircraft from major manufacturers such as Airbus and Boeing.

How the Company Makes Money

BOC Aviation generates revenue primarily through its core business of leasing aircraft to airlines, which involves entering into long-term operating and finance lease agreements. The company earns lease income from these agreements, which provide a steady and predictable cash flow. Additionally, BOC Aviation engages in sale and leaseback transactions, where it purchases aircraft from airlines and leases them back, allowing airlines to unlock capital while maintaining access to the aircraft. The company also benefits from its strategic partnerships with aircraft manufacturers and its well-managed fleet, which enhances its competitiveness in the market. Furthermore, BOC Aviation's strong relationship with Bank of China provides it with favorable financing options, which can reduce its cost of capital and improve profitability.

BOC Aviation Financial Statement Overview

Summary

BOC Aviation has shown strong financial performance with consistent revenue growth and improved profitability margins. The company demonstrates resilience with better cash flow management, despite high leverage. Continued focus on maintaining operational efficiency and managing debt levels will be vital for sustaining its positive trajectory.

Income Statement

BOC Aviation has demonstrated consistent revenue growth with a notable increase from $2.07 billion in 2023 to $2.20 billion in 2024, reflecting a revenue growth rate of 6.11%. The gross profit margin is stable at approximately 26.95% in 2024, although the EBIT margin is not calculable due to the EBIT being zero. EBITDA margin remains strong at 62.42%, indicating robust operational efficiency. Net profit margin improved to 42.05% from 36.92% in the previous year, highlighting enhanced profitability.

Balance Sheet

The company maintains a high debt-to-equity ratio of 2.61, which suggests substantial leverage. However, the return on equity (ROE) improved to 14.52% in 2024, indicating effective use of equity to generate profits. The equity ratio of 25.39% suggests a moderate level of equity financing relative to total assets, which is a positive indicator of financial stability despite the high leverage.

Cash Flow

BOC Aviation shows a significant turnaround in free cash flow, increasing from a negative $1.36 billion in 2023 to a positive $94 million in 2024. The operating cash flow to net income ratio is 2.78, highlighting strong cash generation relative to net income. Additionally, the significant improvement in free cash flow to net income ratio from negative to 0.10 indicates better cash management and reduced capital expenditure burden.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	2.27B	2.20B	2.07B	1.92B	2.04B	1.96B
Gross Profit	664.39M	591.94M	548.89M	1.92B	696.06M	1.96B
EBITDA	1.39B	1.37B	1.35B	1.11B	1.16B	1.19B
Net Income	805.09M	923.59M	763.90M	20.06M	561.32M	509.84M
Balance Sheet
Total Assets	25.57B	25.05B	24.17B	22.07B	23.88B	23.57B
Cash, Cash Equivalents and Short-Term Investments	533.23M	671.33M	391.82M	391.91M	487.61M	408.25M
Total Debt	16.89B	16.59B	16.53B	15.14B	16.72B	16.89B
Total Liabilities	19.07B	18.69B	18.42B	16.87B	18.61B	18.79B
Stockholders Equity	6.50B	6.36B	5.75B	5.20B	5.27B	4.78B
Cash Flow
Free Cash Flow	-934.73M	94.42M	-1.36B	800.56M	-319.98M	-2.81B
Operating Cash Flow	2.67B	2.57B	2.28B	2.01B	1.80B	1.83B
Investing Cash Flow	-2.23B	-1.29B	-2.80B	193.04M	-1.06B	-4.25B
Financing Cash Flow	-437.71M	-1.00B	518.72M	-2.29B	-671.68M	2.58B

BOC Aviation Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 73.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:2588, the sentiment is Positive. The current price of 73 is above the 20-day moving average (MA) of 72.70, above the 50-day MA of 71.01, and above the 200-day MA of 66.10, indicating a bullish trend. The MACD of 0.66 indicates Positive momentum. The RSI at 52.98 is Neutral, neither overbought nor oversold. The STOCH value of 47.21 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HK:2588.

BOC Aviation Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
3877	80 Outperform	HK$12.71B	6.73	13.91%	7.51%	0.17%	-12.66%
2588	73 Outperform	HK$50.66B	8.08	12.82%	4.44%	1.58%	-16.66%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
1848	58 Neutral	HK$3.34B	12.50	6.30%	6.71%	-7.56%	―

BOC Aviation Corporate Events

BOC Aviation to Lease Back Two Airbus A350-1000 to Philippine Airlines

BOC Aviation Limited has announced a transaction with Philippine Airlines Inc. to purchase and lease back two Airbus A350-1000 aircraft. This transaction, which is part of the company’s Qualified Aircraft Leasing Activity, involves long-term operating leases for the aircraft, with deliveries scheduled for 2025 and 2026. The deal is in line with BOC Aviation’s ordinary business operations and is deemed fair and reasonable, benefiting the company and its shareholders.

BOC Aviation Expands Fleet with Airbus A350-900 Leaseback Deal

BOC Aviation Limited has announced a discloseable transaction involving the purchase and leaseback of three Airbus A350-900 aircraft with EgyptAir Holding Company and EgyptAir Airlines Company. This transaction, which includes long-term finance leases, is part of BOC Aviation’s Qualified Aircraft Leasing Activity and is expected to enhance its leasing portfolio and strengthen its position in the global aircraft leasing market.

BOC Aviation Announces Board Restructuring

BOC Aviation Limited announced changes to its Board of Directors and committee memberships effective 30 October 2025. The new board structure includes a mix of executive, non-executive, and independent non-executive directors, with Mr. Zhuo Chengwen as Chairman and Mr. Steven Matthew Townend as CEO and Managing Director. These changes are likely to impact the company’s strategic direction and governance, potentially influencing its market positioning and stakeholder relationships.

BOC Aviation Announces Leadership Change with New Chairman Appointment

BOC Aviation Limited announced a significant leadership change with the resignation of Ms. Zhang Xiaolu and the appointment of Mr. Zhuo Chengwen as the new Chairman of the Board, effective October 30, 2025. This transition is expected to influence the company’s strategic direction, given Mr. Zhuo’s extensive experience in financial management and risk assessment within the Bank of China Group. Stakeholders may anticipate potential shifts in company policies and strategies under Mr. Zhuo’s leadership, which could impact BOC Aviation’s market positioning and operational focus.

BOC Aviation Reports Strong Q3 2025 Performance

BOC Aviation Limited reported its operational data for the third quarter ending September 30, 2025, highlighting a total portfolio of 812 aircraft and engines. The company executed 34 transactions, including commitments to purchase three aircraft, delivery of 11 aircraft, and sales of 10 owned aircraft. Additionally, BOC Aviation raised US$500 million through a bond issuance with its tightest bond spread in history, indicating strong financial positioning. The company’s owned aircraft utilization was maintained at 100%, reflecting operational efficiency and robust demand.

BOC Aviation Announces Interim Dividend Exchange Rate

BOC Aviation Limited announced the exchange rate for the payment of its interim dividend for the first half of 2025. The dividend, initially declared in US dollars, will be paid in Hong Kong dollars at a rate of HK$1.1483 per share, based on the exchange rate as of 26 September 2025. This announcement reflects the company’s financial strategy and commitment to shareholder returns.

BOC Aviation Declares Interim Cash Dividend for 2025

BOC Aviation Limited announced an interim cash dividend of USD 0.1476 per share for the six months ending June 30, 2025, with the payment to be made in Hong Kong dollars at an exchange rate of USD 1 to HKD 7.7795. This dividend reflects the company’s ongoing commitment to returning value to shareholders and may impact its financial performance and stakeholder relations positively.

BOC Aviation Announces New Board of Directors

BOC Aviation Limited has announced changes to its Board of Directors, effective from September 10, 2025. The new board structure includes Ms. Zhang Xiaolu as Chairman and Non-executive Director, with Mr. Steven Matthew Townend serving as the CEO and Managing Director. The announcement reflects a strategic alignment in leadership roles, potentially impacting the company’s governance and strategic direction.

BOC Aviation Announces Resignation of Non-Executive Director

BOC Aviation Limited announced the resignation of Ms. Li Ke from her roles as Non-executive Director, and member of both the remuneration and nomination committees, effective 10 September 2025. The resignation is due to work arrangements, and Ms. Li Ke has confirmed no disagreements with the Board. The company expressed gratitude for her contributions, and this change may impact the company’s governance structure.