[ET Net News Agency, 14 January 2021] UBS Global Research lowered its target price for
China Eastern Airlines (CEA) (00670) to HK$4.4 from HK$4.5 and maintained its "buy"
rating.
The research house cut its 2021 reported net profit forecast to Rmb2bn to reflect (1)
stronger-than-expected recovery in the domestic market, offset by delayed opening-up of
international markets; (2) improved cost control; and (3) Rmb appreciation.
UBS views CEA's valuations as attractive and expects the company to be a beneficiary of
potentially continuous recovery of air traffic in China and COVID-19 vaccines. However,
UBS expects CEA's earnings to underperform in 2021 among the big three as its two golden
routes, Beijing-Shanghai and China-Japan, may face a demand gap in 2021. (KL)