French stock report - Air France - KLM

FRA

Two-bagger Air France - KLM increases 1.2% January 18, 2018 17:30 CET

NEWS BITES - EUROPE

Air France - KLM (FR:AF), France's 3rd largest Travel & leisure company by market cap, has increased 15.0c (1.2%) from its last trading session of January 17 to close at EUR13.07. Compared with the CAC 40 Index which rose 0.8 points (0.02%) in the day, the relative price increase was 1.1%. A two-bagger in the past year, the value of EUR1,000 invested one year ago is EUR2,624 [vs EUR1,132 for the CAC 40 Index], for a capital gain of EUR1,624. The total return to shareholders for 1 year is 162.4%. The volume was 0.4 times the average daily trading volume of 4.8 million shares.

Highlights in today's Report:

SECTION 1 BULLISH SIGNALS

Fundamentals, Undervaluation [compared with sector average], Technicals, Oversold/Bullish/Support Signals, High Performance Indicators

SECTION 2 BEARISH SIGNALS

Fundamentals, Overvaluation [compared with sector average], Technicals, Low Performance Indicator

SECTION 3 PRICE VOLUME DYNAMICS

Technicals, Moving Annual Return, Beta, Turnover Rate & Turnover Period

SECTION 4 RANKING

Global, Independent Ratings

SECTION 5 FINANCIALS

SECTION 6 PROFILE

Activities, Industry & Sector, Top Management, Issued Capital

SECTION 7 STOCK BUZZ

SECTION 1 AIR FRANCE - KLM BULLISH SIGNALS

1.1 Fundamentals:

+ Tobin's Q Ratio, defined as MCap divided by Total Assets, is 0.2. Compared with the rest of the market the stock is undervalued and ranks in the top 7% of stock by value of Q Ratio.

+ As per the Du Pont analysis, Return on Equity is high at 41.2%. This is computed as net profit margin of 2.1% times asset turnover [sales/assets] of 1.1 times leverage factor [total assets/shareholders' equity] of 17.9.

1.2 Undervaluation [compared with sector average]:

+ Price/Earnings of 5.7 [20.1].

+ Price/Sales of 0.2 [0.7]. We estimate Air France - KLM stock is trading at a current year Price/Sales of 0.2 and a forward year Price/Sales of 0.2.

+ Return on Equity 41.2% [12.8%].

+ Price to EBITDA of 2.3 [9.4].

1.3 Technicals:

+ The Moving Average Convergence Divergence (MACD) indicator of 12-day Exponential Moving Average (EMA) of 13.33 minus the 26-day EMA of 13.26 is positive 0.07 suggesting a bullish signal.

+ Rises to Falls: in the past month the number of rises outnumbered falls 13:8 or 1.6:1.

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

+ A two-bagger in the past year, the present value of EUR1,000 (PV1000) invested one year ago in Air France - KLM is EUR2,624, for a capital gain of EUR1,624.

PV10001-week1-month1-year
AF.FR9829902,624
CAC 40 Index1,0011,0231,132

+ The present value of EUR1,000 (PV1000) invested five years ago in Air France - KLM is EUR1,572, for a capital gain of EUR572.

+ 5 years Multiplier in EUR = 1.572x

+ Compound Annual Growth Rate (CAGR) in EUR = 9.5%

Present Value of USD1,000 invested 5 years ago:

+ The present value of USD1,000 (PV1000) invested five years ago in Air France - KLM is $US1,441, for a capital gain of $US441.

+ 5 years ago EUR 1 equalled USD 1.3297

+ 5 years Multiplier in USD = 1.441x

+ Compound Annual Growth Rate (CAGR) in USD = 7.6%

Jan 18, 2018: EUR 1 equals USD 1.22

1.4 Oversold/Bullish/Support Signals:

+ The Stochastic indicator of 14.9 has pierced the oversold line of 20; this indicates the price is close to its 14-day low and is likely to revert to an uptrend.

1.5 High Performance Indicators:

DescriptionValueRank In Market
Price to Sales0.2In Top 4%
Today's TurnoverEUR23.8 million (US$29 million)In Top 5%
Price Change %1.2In Top Quartile

SECTION 2 AIR FRANCE - KLM BEARISH SIGNALS

2.1 Fundamentals:

+ Total Liabilities/EBITDA of 9 which compares unfavourably with the Joseph Piotroski benchmark of 5.

+ Net profit margin has averaged 0.7% in the last 3 years. This suggests the company is less profitable with a low margin of safety.

2.2 Overvaluation [compared with sector average]:

+ Return on Assets 2.3% [3.4%].

2.3 Technicals:

+ The price decreased 1.8% in the last week and 1.0% in the last month.

2.4 Low Performance Indicator:

DescriptionValueRank In Market
Total Debt to Equity6.6In Bottom 1%

SECTION 3 PRICE VOLUME DYNAMICS

3.1 Technicals:

+ Volume: there were 1,820,000 shares worth EUR23.8 million (US$29 million) traded today. In the past week, volume was 0.6 times average and the shares were down 1.8%.

+ Air France - KLM is at a discount of 10.8% to its 12-month high of EUR14.65 on November 03, 2017. It is also at a premium of 173.4% to the 12-month low of EUR4.78 on February 07, 2017.

3.2 Moving Annual Return

Based on a dynamic start date of 5 years ago, the Moving Annual Return has been positive in 2 of the last 5 years. An investment a year ago in AF would have produced a return of 162.4%.

AFClose (EUR)Annual Return %
Jan 1813.07162.4
1 Yr ago4.98(32.8)
2 Yrs ago7.41(0.4)
3 Yrs ago7.44(20.0)
4 Yrs ago9.311.9

Close 5 years ago EUR8.31

3.3 Beta:

+ Beta: the Beta of Air France - KLM stock is 0.9. 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 172.6% (or a turnover period of 6 months). This average length of ownership of the stock at 0.3 times the average holding period of 1 year 10 months for stocks in the CAC 40 Index suggests a larger number of speculators on the share register, making it less safe for long-term investors.

SECTION 4 RANKING

4.1 Global Rank [out of 47,422 stocks] and Rank in the Europe Region [out of 8,526 stocks]

DescriptionValueGlobal RankIn Eur Region
MCap (US$)6.8B2,180512
Total Assets (US$)28.1B1,350321
Revenue (US$)30.5B450126
Net Profit (US$)971.6M1,043228
Return on Equity %41.2896199
Net Profit Margin %2.123,6053,756
Price/Earnings5.71,741423
PV$1000 (1Year) US$*3,0161,379211
US$* Change (1Year) %199.51,323193

* 1 year ago EUR 1 = USD 1.07

Jan 18, 2018: EUR 1 equals USD 1.22

4.2 Independent Ratings

+ Fortune 500:

Air France - KLM was ranked 386 by total revenues in the Fortune 500 annual list for 2017; a deterioration over a year from rank 363 in 2016.

+ Forbes 2000:

It is the 289th largest by revenue in the Forbes Global 2000.

+ BSS/News Bites:

It is placed 17/591 in BSS News Bites' ranking of French performers in the past year, a percentile ranking of 97.

+ Vanguard Total World Stock ETF 7457:

The stock was one of 7457 global stocks selected by Vanguard Total World Stock ETF (VT). As at November 30, 2017, the Vanguard Total World Stock ETF held 37,247 shares worth $US529,480 by value of the ETF's portfolio [Ranked 3072 out of 7457 by value and 82 out of 126 for France].

SECTION 5 AIR FRANCE - KLM FINANCIALS

Financials Summary

Year endedDec 2016Dec 2015Dec 2014
Sales (USD B)29.931.430
Pretax (USD M)991.624175.9
Net (USD M)954.3142.2(238.6)
EPS (EUR)1.62910.115(0.67)

Net profit was up 571.2% from US$142.2 million in 2015 to US$954.3 million in 2016. Earnings Per Share (EPS) was up 1,316.1% from 11.50c to EUR1.63.

SECTION 6 AIR FRANCE - KLM PROFILE

6.1 Activities

Air France-KLM is one of the world's leading airline companies. Net sales break down by activity as follows: - passenger transportation (77.5%): 71.4 million people transported in 2009/10; - freight transportation (11.6%; No. 2 worldwide): 1.5 Mt of merchandise transported; - maintenance services (4.6%); - other (6.3%): primarily catering service activities (Servair and KLM Catering Services) and charters (Transavia.com). At the end of March 2010, the group had a fleet of 625 airplanes divided between the domestic fleets of Air France (262, of which 148 owned and 114 leased) and KLM (113, of which 33 owned and 80 leased), and the regional fleets of KLM Cityhopper (48, of which 32 owned and 16 leased), Brit Air (43, of which 16 owned and 27 leased), City Jet (27, of which 16 owned and 11 leased), Regional (64, of which 23 owned and 41 leased), VLM Airlines (17, of which 15 owned and 2 leased) and other (51, of which 8 owned and 43 leased).

6.2 Industry & Sector

Classification LevelName of Sector
Industry GroupHotels & Entertainment Services
IndustryLeisure & Recreation
Economic SectorConsumer Cyclicals
Business SectorCyclical Consumer Services

6.3 Top Management

The chief executive officer and chairman is Jean-Marc Janaillac and the chief financial officer is Frederic Gagey.

6.4 Issued Capital

Based on 428,630,000 issued shares the market capitalisation is EUR5.6 billion (US$6.8 billion).

SECTION 7 STOCK BUZZ

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January 09: AIR FRANCE - KLM: DECEMBER 2017 TRAFFIC

DECEMBER 2017 TRAFFIC

Group passenger activity: number of passengers rose by 2.6%, traffic increased by 3.4% (measured in revenue passenger-kilometer) and load factor improved by 0.7pt. Unit revenue ex-currency (measured in available seat-kilometer) up compared to December 2016.

December 08 2017: AIR FRANCE - KLM : NOVEMBER 2017 TRAFFIC

TRAFFIC OF THE MONTH OF NOVEMBER 2017

Group passenger activity: passenger numbers up 5.9%, traffic up 5.7% (measured in passenger-kilometers transported) and occupancy rate up 1.5%. Non-exchange unit revenue (measured in available seat-kilometers) up from November 2016.

November 29 2017: AIR FRANCE - KLM and Jet Airways sign an Enhanced Cooperation Agreement

On 29 November 2017, Air France-KLM and Jet Airways signed a landmark 'Enhanced Cooperation Agreement' for the development of their operations between Europe and India.

A first in the history of Indian aviation, this agreement strengthens the partnership built between the three airlines since 2014. This cooperation was expanded in 2016 with an extensive code-share agreement for connections between Europe and North America and Jet Airways' hubs at Mumbai and Delhi in India via Air France-KLM' hubs at Paris-Charles de Gaulle and Amsterdam-Schiphol.

Jean-Marc Janaillac, Chairman and CEO of Air France-KLM stated: "Air France-KLM and Jet Airways are launching the first cooperation agreement of its kind on the India - Europe market, one of the markets at the heart of the group's strategy for the coming years.

November 17 2017: AIR FRANCE - KLM: Declaration of number of voting rights at November 16, 2017

Information relating to the total number of voting rights and shares as required by L.233-8 II of the code of commerce and article 223-16 of the general rules of the French market authority (AMF).

Date Number of shares Total number of voting rights

16/11/2017 428,634,035

Theoretical number of voting rights: 504,635,266

November 09 2017: AIR FRANCE - KLM : Conversion in new shares of almost all the OCEANEs maturing on February 15, 2023

Air France-KLM announces that, following its decision published on 16 October 2017 to exercise its early redemption option in respect of its bonds convertible into and/or exchangeable for new or existing shares maturing on February 15, 2023 (ISIN FR0011453463, the "OCEANEs"), nearly all the holders of OCEANEs have exercised their right to convert their OCEANEs into shares.

Exercise notices for 53,359,937 OCEANEs have been received, representing 99.96% of the outstanding OCEANEs as at 16 October 2017, giving right to the delivery of 53,359,937 ordinary shares with a nominal value of EUR 1.00 each.

33,097,018 new shares will be delivered on 10 November 2017 to the holders of OCEANEs having sent their exercise notice before 31 October 2017 (included).

Contact: +33 (0)1 41 56 88 85

Physical Address: 45 rue de Paris POBox 90112 95747 Roissy Charles de Gaulle France

State/Province/Country: France

Country of Incorporation: France

Exchange: Euronext - Paris

ISIN: FR0000031122

FR:AF; EPA:AF; PA:AF; FP:AF; AIRF.PA

PermID: 4295866970

Air France Klm Sa, Air France-Klm, Astoria Financial Corp

Source: www.BuySellSignals.com