CPA - Copa Holdings Continues To Execute Well But COVID-19 Lingers On As A Threat
- Copa posted better than expected second quarter results, including better passenger traffic, stronger EBITDAR, and a reversal of its cash burn.
- Traffic and capacity are still well below pre-pandemic norms, with factors like country-by-country vaccination rates, COVID-19 infection rates, and travel restrictions still limiting demand.
- Management is targeting sub-$0.06 CASM-ex fuel once traffic normalizes, and financial difficulties at other airlines appear to be creating new route opportunities for the coming years.
- Long-term revenue growth of 4% and a low-double-digit FCF margin can support a fair value above $100, though there are still elevated short-term risks from the pandemic.
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Copa Holdings Continues To Execute Well, But COVID-19 Lingers On As A Threat