Goldman Sachs lifted its target price for China Eastern Airlines (CEA)(00670) to HK$6.2 from HK$6.1 and maintained its "buy" rating.
The research house said CEA's valuations are attractive, trading at near trough levels on EV/GCI and P/B. Goldman also expects the combination of stronger demand, controlled capacity, and lower oil prices to boost earnings over the coming quarters.
It thinks CEA also benefits from pricing deregulation, given its strong presence in Shanghai, and Goldman likes its exposure to the low-cost carrier business model, through subsidiary China United, which will start operating out of Beijing Daxing International Airport (BDIA) from its opening in September 2019.
Goldman cut its 2019/20/21 adjusted net income estimates by 20.6%/22.5%/18.1%.
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