Russian stock report - Aeroflot - Russian Airlines

RUSS

Aeroflot - Russian Airlines decreases April 19, 2018 18:00 SAMT

NEWS BITES - BRIC

Aeroflot - Russian Airlines (MICEX:AFLT), Russia's largest Airline company by market cap, has decreased RUB1.20 (0.8%) from its last trading session of April 18 to close at RUB151.45. Compared with the MOEX Russia Index which fell 16.9 points (0.8%) in the day, the relative price change was -0.03%. The volume was 0.7 times the average daily trading volume of 5.5 million shares.

YEAR-TO-DATE

Aeroflot - Russian Airlines climbs 9% in 2018, outperforming 83% of the market

Aeroflot - Russian Airlines (MICEX:AFLT), climbed RUB12.75 (or 9.2%) year-to-date (YTD) in 2018 to close at RUB151.45. This means the stock has outperformed 83% of Russia-listed stocks in 2018. Compared with the MOEX Russia Index which has risen 5.7% YTD, this is a relative price increase of 3.5%.

Highlights in today's Report:

SECTION 1 BEARISH SIGNALS

Fundamentals, Technicals, Low Performance Indicators

SECTION 2 BULLISH SIGNALS

Fundamentals, Technicals, High Performance Indicators

SECTION 3 PRICE VOLUME DYNAMICS

Technicals, Moving Annual Return, Beta, Turnover Rate & Turnover Period, Month-on-Month Comparison (Trailing Month - ended 18th)

SECTION 4 PEER GROUP ANALYSIS & RANKING

Global Peer Group Analysis (all figures in USD), Global, Regional, Market, Index, Sector, Independent Ratings

SECTION 5 FINANCIALS

SECTION 6 PROFILE

Activities, Industry & Sector, Issued Capital

SECTION 7 STOCK BUZZ

SECTION 1 AEROFLOT - RUSSIAN AIRLINES BEARISH SIGNALS

1.1 Fundamentals:

+ Total Liabilities/EBITDA of 7.6 which compares unfavourably with the Joseph Piotroski benchmark of 5.

1.2 Technicals:

+ In the last three months the stock has hit a new 52-week low thrice.

+ The price sank 5.2% in the last month.

+ Compared with the MOEX Russia Index which fell 2.7% for the month, this represented a relative price decrease for Aeroflot - Russian Airlines stock of 2.5% for the month.

+ The Moving Average Convergence Divergence (MACD) indicator of 12-day Exponential Moving Average (EMA) of 149.83 minus the 26-day EMA of 150.27 is negative 0.44 suggesting a bearish signal.

+ The present value of RUB1,000 (PV1000) invested one year ago in Aeroflot - Russian Airlines is RUB931, for a capital loss of RUB69.

PV10001-week1-month1-year
AFLT.MICEX1,027948931
MOEX Russia Index1,0099891,159

1.3 Low Performance Indicators:

DescriptionValueRank In Market
% Prem to Vol Wtd Price0.5In Bottom Quartile
EBITDA Margin %6.3In Bottom Quartile

SECTION 2 AEROFLOT - RUSSIAN AIRLINES BULLISH SIGNALS

2.1 Fundamentals:

+ The P/E of 7.1 multiplied by the P/NTA of 3 is 21.0. Being less than the Benjamin Graham benchmark of 22.5 the stock appears undervalued.

+ Tobin's Q Ratio, defined as MCap divided by Total Assets, is 0.5. Compared with the rest of the market the stock is undervalued.

+ The company is cash rich with Cash to Market Capitalisation at 32.6%.

+ As per the Du Pont analysis, Return on Equity is high at 34.9%. This is computed as net profit margin of 4.3% times asset turnover [sales/assets] of 1.6 times leverage factor [total assets/shareholders' equity] of 4.9.

2.2 Technicals:

+ The present value of RUB1,000 (PV1000) invested five years ago in Aeroflot - Russian Airlines is RUB2,886, for a capital gain of RUB1,886.

+ 5 years Multiplier in RUB = 2.886x

+ Compound Annual Growth Rate (CAGR) in RUB = 23.6%

Present Value of USD1,000 invested 5 years ago:

+ The present value of USD1,000 (PV1000) invested five years ago in Aeroflot - Russian Airlines is $US1,504, for a capital gain of $US504.

+ 5 years ago USD 1 equalled RUB 31.6456

+ 5 years Multiplier in USD = 1.504x

+ Compound Annual Growth Rate (CAGR) in USD = 8.5%

Apr 19, 2018: USD 1 equals RUB 60.73

2.3 High Performance Indicators:

DescriptionValueRank In Market
Today's TurnoverRUB579.2 million (US$9.5 million)In Top 4%
Earnings Yield %14.1In Top 8%
Price/MAP501.01In Top Quartile
Cash to MCap %32.6In Top Quartile

SECTION 3 PRICE VOLUME DYNAMICS

3.1 Technicals:

+ Volume: there were 3,824,200 shares worth RUB579.2 million (US$9.5 million) traded today. In the past week, volume was 0.7 times average and the shares were up 2.7%.

+ Aeroflot - Russian Airlines is at a discount of 32.2% to its 12-month high of RUB223.35 on July 12, 2017. It is also at a premium of 16.0% to the 12-month low of RUB130.60 on January 29.

3.2 Moving Annual Return

Based on a dynamic start date of 5 years ago, the Moving Annual Return has been positive in 3 out of 5 years.

AFLTClose (RUB)Annual Return %
Apr 19151.45(6.9)
1 Yr ago162.75112.8
2 Yrs ago76.49101.3
3 Yrs ago38(28.8)
4 Yrs ago53.41.8

Close 5 years ago RUB52.47

3.3 Beta:

+ Beta: the Beta of Aeroflot - Russian Airlines stock is 0.7. A Beta lower than 1 suggests this is a low risk, low return stock with volatility less than that of the market.

3.4 Turnover Rate & Turnover Period:

+ The turnover rate in the 12 months to date was 108.5% (or a turnover period of 11 months). This average length of ownership of the stock at 0.2 times the average holding period of 3 years 10 months for stocks in the MOEX Russia Index suggests a larger number of speculators on the share register, making it less safe for long-term investors.

3.5 Month-on-Month Comparison (Trailing Month - ended 18th)

18 Apr16 Mar16 Feb18 Jan18 Dec17 Nov
Price 18 Apr (RUB)152.65162.05136.95137.35145.25162.05
% Price Change-4.418.3-2.9-5.4-11.9-10.5
Avg Daily Volume5,711,9175,196,8314,865,0034,597,1234,379,3144,656,258
VWAP (RUB)146.37144.26143.31153.91167.01182.14
Price Range (RUB)137.55 - 163.25136.5 - 165.35130.6 - 147.3136.65 - 151.8136.25 - 168.6154.05 - 185.95
Relative Price Change %-2.216.7-3-13.1-11.8-12.5
Volatility %18.721.112.811.123.720.7

SECTION 4 PEER GROUP ANALYSIS & RANKING

4.1 Global Peer Group Analysis (all figures in USD)

NameRelative Str. (6 mo)MCapPV $1000 (1 yr)RevenueNet ProfitTotal Assets
Air France - KLM (AF)344.6B1,390.831.8B(337.4M)30.1B
Copa Holdings Class A (CPA)723.8B1,132.32.3B334.5M3.8B
AirAsia (5099)843.2B1,547.21.9B530.8M5.7B
Korean Air Lines (A003490)273B1,231.711.6B(531M)22.5B
Aeroflot - Russian Airlines (AFLT)422.8B860.8
Air New Zealand (AIZ)662.7B1,556.03.9B293.6M5.5B
EVA Airways (2618)672.2B1,149.65B119.3M7.5B
WestJet Airlines (WJA)492.1B1,102.83.5B220M5B
China Airlines (2610)562B1,187.24.9B19.6M7.7B

Global Peer Group Analysis (continued)

CodeCountryLast PriceP/EP/SP/BookTurnover Rate (%)% Disc to 52-w HiRetention Ratio*
AFFREUR8.600.12.2278.241.3
CPAUS$US123.4015.61.62.2225.412.163.5
5099MYMYR3.895.31.82.067.218.167.4
A003490KRKRW34,350.00.32.4147.613.0
AFLTRURUB152.657.20.33.0107.431.6
AIZAUAUDA3.119.30.71.92.54.339.3
2618TWTWD15.4018.40.41.335.96.176.0
WJACACAD23.109.50.61.285.416.677.0
2610TWTWD10.550.41.145.320.4

*Retention Ratio: The retention ratio is an opposite of payout ratio and refers to the percentage of net income that is retained to grow the business.

4.2 Global Rank [out of 47,659 stocks] and Rank in the Europe Region [out of 8,557 stocks]

DescriptionValueGlobal RankIn Eur Region
MCap (US$)2.8B4,274923
PV$1000 (1Year) US$*86127,7614,230
US$* Change (1Year) %-8.226,7055,195

* 1 year ago USD 1 = RUB 56.18

Apr 19, 2018: USD 1 equals RUB 60.73

4.3 Rank in the MICEX Index [out of 38 stocks] and Rank in the Total Russian Market [out of 213 stocks]

DescriptionValueIn MICEX IndexIn Total Russian Market
MCap (RUB)168.2B2732
Total Assets (RUB)323.3B2733
Revenue (RUB)532.9B1315
Net Profit (RUB)23.1B2123
Return on Equity %34.9817
Net Profit Margin %4.32762
Price to Book3.017114
Price/Earnings7.11054
PV1000 (1Year)93129119

4.4 Independent Ratings

+ BSS/News Bites:

Aeroflot - Russian Airlines is placed 98/169 in BSS News Bites' ranking of Russian performers in the past year, a percentile ranking of 42.

+ Vanguard Total World Stock ETF 7517:

The stock was one of 7517 global stocks selected by Vanguard Total World Stock ETF (VT) who bought 50,700 shares in the period Nov 30, 2017 to Jan 31, 2018 worth $US7,148,000 at an estimated Volume Weighted Average Price (VWAP) of $US140.9862. As at Jan 31, 2018, the Vanguard Total World Stock ETF held 156,300 shares worth $US391,362 by value of the ETF's portfolio [Ranked 3872 out of 7517 by value and 15 out of 34 for Russia].

SECTION 5 AEROFLOT - RUSSIAN AIRLINES FINANCIALS

Annual Report for the year ended December 31, 2017 (year-on-year comparisons with previous corresponding period)-

Favourable Changes:

+ Interest revenue to Sales up from 0.9% to 1.2%.

+ Debt to Equity down 51.8% from 2.8 to 1.3.

+ Total liabilities to Total assets down 7% from 0.9 to 0.8.

+ Current ratio up 10.2% from 1.1 to 1.2.

+ Total current assets to Total Assets up from 43.5% to 52%.

+ Cash to Total Assets up from 10.5% to 14.2%.

Unfavourable Changes:

+ Net profit slumps 40.6% from RUB38.8b ($US634.0m) to RUB23.1b ($US400.6m)

+ EPS slumps 39.8% from RUB35.43 (US57.85c) to RUB21.34 (US37.07c).

+ EBIT Margin down from 10.7% to 6.3%.

+ EBIT to total assets down from 17.8% to 10.4%.

+ Sales and marketing expenses to Sales up from 31.1% to 33.3%.

+ Profit before tax to Sales down from 10.7% to 6.3%.

+ Retained earnings to total assets down from 25.8% to 25.2%.

+ Total non-current assets to Total Assets down from 56.5% to 48%.

+ Fixed Assets to Total Assets down from 35% to 30.3%.

+ Other non-current assets to Total Assets down from 17.5% to 13.9%.

+ Total Liabilities to EBITDA of 7.6 compares unfavourably with the Joseph Piotroski benchmark of <5. This ratio has deteriorated by 58.5% from the previous year's ratio of 4.8.

+ Total Liabilities to Operating Cash Flow of 5.4 compares unfavourably with the Joseph Piotroski benchmark of <4. This ratio has deteriorated by 55.9% from the previous year's ratio of 3.5.

Note:

+ Total revenue to total assets steady at 1.6.

+ Tax expenses to Sales down from 2.9% to 2%.

SECTION 6 AEROFLOT - RUSSIAN AIRLINES PROFILE

6.1 Activities

Aeroflot - Russian Airlines transports passengers and freight. The Company operates scheduled international and domestic passenger flights and cargo services. Aeroflot's fleet consists of Boeing, Airbus, and other aircraft.

6.2 Industry & Sector

Classification LevelName of Sector
Business SectorTransportation
Industry GroupPassenger Transportation Services
IndustryAirlines
Economic SectorIndustrials

6.3 Issued Capital

Based on 1,110,616,299 issued shares the market capitalisation is RUB168.2 billion (US$2.8 billion).

SECTION 7 STOCK BUZZ

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December 04 2017: Aeroflot - Russian Airlines: Information for passengers flying from/to Sheremetyevo Airport on 4 December 2017

Due to forecast poor weather conditions, the following flights at Sheremetyevo International Airport have been cancelled for December 4 2017:

December 02 2017: Aeroflot - Russian Airlines: Information for passengers traveling to/from Sheremetyevo airport on December 02, 2017

Due to severe weather conditions Aeroflot is amending the flight schedule for December 02, 2017.

All the dates and timing is Moscow time.

The following flights on 02.12.2017 are cancelled:

SU2402 Moscow - Rome 08:05. The passengers will be carried by flight

SU2418, planned departure time is 09.55 02.12.2017

SU2416 Moscow - Milan 07:15.

December 02 2017: Aeroflot - Russian Airlines: Updated information for passengers travelling to and from Sheremetyevo International Airport on 2 December 2017

Due to limitations imposed at Sheremetyevo International Airport, Aeroflot has made alterations to its timetable for 2 December.

December 01 2017: Aeroflot named Best Russian Airline by National Geographic Traveler Awards 2017

1 December 2017, Moscow. - Aeroflot has once again been named best Russian airline in the annual on-line survey organised by National Geographic Traveler Awards among Russian readers of the magazine. The Awards ceremony took place on 30 November in Moscow.

November 30 2017: AEROFLOT ANNOUNCES 9M 2017 IFRS FINANCIAL RESULTS

М oscow, 30 November 2017 - Aeroflot Group ("the Group", Moscow Exchange ticker: AFLT) today publishes its condensed consolidated interim financial statements for the nine months ended 30 September 2017, in accordance with International Financial Reporting Standards.

Contact: +7-495-1556643

State/Province/Country: Russia

Exchange: Moscow Exchange (MICEX)

ISIN: RU0009062285

M:AFLT; MCX:AFLT; MM:AFLT; RM:AFLT; AFLT.MM

PermID: 4295887102

RIC: AFLT.MM

Source: www.BuySellSignals.com