Fact based stock research
China Airlines (TSEC:2610)

TW0002610003

How to read the ranks

For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".

Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".

Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.

Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.

(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).

(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.

China Airlines stock research in summary

china-airlines.com

ANALYSIS: With an Obermatt Combined Rank of 1 (worse than 99% compared with investment alternatives), China Airlines (Airlines, Taiwan) shares have lower financial characteristics compared with similar stocks. Shares of China Airlines are low in value (priced high) with a consolidated Value Rank of 22 (worse than 78% of alternatives), show below-average growth (Growth Rank of 5), and are riskily financed (Safety Rank of 11), which means above-average debt burdens. ...read more

RECOMMENDATION: A Combined Rank of 1, is a sell recommendation based on China Airlines's financial characteristics. As the company China Airlines's key financial metrics all exhibit below-average performance, such as low value (Obermatt Value Rank of 22), low growth (Obermatt Growth Rank of 5), and risky financing practices (Obermatt Safety Rank of 11), it is a somewhat questionable stock investment, where the risk of paying too much for the shares is significant, unless the company has an exceptionally bright future. Such poor financial performance sometimes indicates that the company's business is all concentrated in some distant future. This is sometimes the case for high-tech or biotechnology companies. If they own properties that only provide cash flows in the future, the stock may look excessively expensive and risky today. In such cases, the Obermatt Method has limited value as it is based on facts we can observe today. If the facts are all in the future, stock investing becomes guesswork, and this should only be a driver in a limited number of investments that should only amount to a small fraction of a safe portfolio. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more

Latest Obermatt Ranks


360° View^new
Sentiment Rank^new
Value Rank	22
Growth Rank	5
Safety Rank	11
Combined Rank	1

Country	Taiwan
Industry	Airlines
Index	Low Emissions, Energy Efficient, Human Rights, FTSE Taiwan
Size class	X-Large

25-Apr-2024. Stock data may be delayed. Log in or sign up to get the most recent research.

Further information

Multiple opinions. One number.

Analysts rarely agree on a stock’s future. So, who do you believe? Obermatt translates those collective views into a single Sentiment Rank. That plus the financial ranks give you the ultimate 360° View. Sign up to access them.

Why popular stocks have low ratings

It’s easier said than done. When your stock drops, it’s easy to want to sell it and find a better performer. Think twice, or even three times, before trading. Those fees (especially the hidden ones) can eat up your gains.

Review the performance ranks of the individual metrics that form each investment strategy.

Research History: China Airlines

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	24	41	28	22
GROWTH
GROWTH	70	83	73	5
SAFETY
SAFETY	23	23	5	11
SENTIMENT
SENTIMENT	n/a	65	75	^new
360° VIEW
360° VIEW	n/a	45	36	^new

Most recent update of the stock research: 25-Apr-2024. Financial reporting date used for calculating ranks: 31-Dec-2023. Stock research history is based on the Obermatt Method. The higher the rank, the better China Airlines is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	24	41	28	22
GROWTH
GROWTH	70	83	73	5
SAFETY
SAFETY	23	23	5	11
COMBINED
COMBINED	33	50	14	1

Last update of combined financial performance: 25-Apr-2024. Stock analysis on combined financial performance: The higher the rank of China Airlines the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 22 (worse than 78% compared with alternatives), China Airlines shares are significantly more expensive than comparable stocks. The Value Rank is based on consolidating four value indicators, where the majority of metrics are below, and only one is above average for China Airlines. Price-to-Sales (P/S) is 61, which means that the stock price compared with what market professionals expect for future sales is lower than 61% of comparable companies, indicating a good value concerning to China Airlines's revenue size. But all other performance indicators point in a different direction. Dividend yields have a Dividend Yield rank of 24, meaning that dividends are expected to be lower than for 76% of comparable investments. Furthermore, Price-to-Book Capital (also referred to as market-to-book ratio) is less favorable than 71% of alternatives (only 29% of peers have an even higher ratio). The same is valid for Price-to-Profit (or Price / Earnings, P/E), which is higher than for 86% of comparable companies, making the stock more expensive compared with the company's expected profit levels. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 22, is a sell recommendation based on China Airlines's stock price compared with the company's operational size and dividend yields. Since Price-to-Sales is a stable value indicator even in challenging times, investing in China Airlines could be seen as a value investment. However, there must be a good reason for the low market-to-book rank. If the company has a typical capital investment practice, the stock may be overvalued because the profit and dividend-related performance indicators are also low. The stock is only good value if investors can expect profits and dividends to pick up in the future. Else, China Airlines looks like an expensive investment today. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision, which is especially important in this case, as the financial indicators are inconclusive. ...read more

VALUE METRICS	2021	2022	2023	2024
PRICE VS. REVENUES (P/S)
PRICE VS. REVENUES (P/S)	69	55	67	61
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	42	63	26	14
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	27	29	26	29
DIVIDEND YIELD
DIVIDEND YIELD	1	36	38	24
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	24	41	28	22

Last update of Value Rank: 25-Apr-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of China Airlines; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 5 (better than 5% compared with alternatives), China Airlines shows one of the most restricted growth dynamics in its industry. There is little momentum in this company. The Growth Rank is based on consolidating four value indicators, with three out of four indicators below average for China Airlines. Sales Growth has a below market rank of 20, which means that, currently, professionals expect the company to grow less than 80% of its competitors. The same is valid for Capital Growth, with a rank of 10, and Profit Growth, with a rank of 28. Currently, professionals expect the company to grow its profits less than 72% of its competitors). Only shareholders are optimistic. Stock Returns are above average at a rank of 56, which means that the stock returns have recently been above 56% of alternative investments. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 5, is a sell recommendation for growth and momentum investors. That picture may be the result for a company that has reached the bottom. All went south for China Airlines, and it still looks bad, but some investors already see light at the end of the tunnel, rewarding the stock with recent above-market stock returns. It could also mean that investors are correcting an overreaction to negative news. If that were the case, the positive stock returns are not yet a sign of recovery. Investors should look closely at the Value and Sentiment indicators before they make a stock purchasing decision, because growth is unlikely to be the driving argument behind this investment. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case, especially since the growth performance is low here. ...read more

GROWTH METRICS	2021	2022	2023	2024
REVENUE GROWTH
REVENUE GROWTH	22	72	13	20
PROFIT GROWTH
PROFIT GROWTH	38	98	96	28
CAPITAL GROWTH
CAPITAL GROWTH	n/a	17	61	10
STOCK RETURNS
STOCK RETURNS	90	83	67	56
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	70	83	73	5

Last update of Growth Rank: 25-Apr-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of China Airlines.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 11 (better than 11% compared with alternatives), the company China Airlines has much riskier financing practices than comparable other companies, which means that their overall debt burden is significantly above the industry average. This doesn't mean that the business of China Airlines is also risky, it only means that the company is on the riskier side in respect to bankruptcy in case things turn sour, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with all three metrics below average for China Airlines. Liquidity is at 38, meaning that the company generates less profit to service its debt than 62% of its competitors. This indicates that the company is on the riskier side when it comes to debt service. Even worse, Leverage is at a rank of 26, meaning the company has an above-average debt-to-equity ratio. It has more debt than 74% of its competitors. Finally, Refinancing is at a rank of 11 which means that the portion of the debt about to be refinanced is above average. It has more debt in the refinancing stage than 89% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 11 (worse than 89% compared with alternatives), China Airlines has a financing structure that is significantly riskier than that of its competitors. This combination is rather dangerous in most situations. Only very promising companies with bright future outlooks and stellar reputations can operate with such risky financing. Investors should look at Obermatt’s Value, Growth, and Sentiment Ranks to confirm a very positive outlook or be careful with investing in stocks of China Airlines because it may suffer significantly in case of future difficulties. ...read more

SAFETY METRICS	2021	2022	2023	2024
LEVERAGE
LEVERAGE	29	20	18	26
REFINANCING
REFINANCING	51	53	11	11
LIQUIDITY
LIQUIDITY	24	38	8	38
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	23	23	5	11

Last update of Safety Rank: 25-Apr-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of China Airlines and the more cash is available to service its debt.

Sentiment Metrics in Detail

SENTIMENT	2021	2022	2023	2024
ANALYST OPINIONS
ANALYST OPINIONS	n/a	91	20	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	50	72	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	6	54	^new
MARKET PULSE
MARKET PULSE	n/a	83	95	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	65	75	^new

Last update of Sentiment Rank: 25-Apr-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for China Airlines.
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