Friday January 15, 2021 15 January 2021

NEWS BITES - BRIC

Aeroflot - Russian Airlines (MICEX:AFLT), Russia's largest Airline company by market cap, is currently the 15th lowest price earnings stock in the MOEX Russia Index of 36 stocks.

The price earnings ratio is 7.2.

The earnings yield of 13.8% is 2.3 times the 10-year bond yield of 6.0%.

The value of RUB1,000 invested one year ago is RUB652 [vs RUB1,101 for the MOEX Russia Index], for a capital loss of RUB348. The total return to shareholders for 1 year is -34.8%.

The stock has decreased 86.0 Kopeck (1.2%) from its previous trading session to close at RUB72.30. Compared with the MOEX Russia Index which fell 39.9 points (1.1%) in the day, the relative price change was -0.04%.

Bearish Turning Point

Relative Strength Index (RSI)

The Relative Strength Index (RSI) of 71.5 has penetrated the overbought line of 70, suggesting the price gain of 5.2% in the last 14 days is unusually high. The RSI was previously 58.8.

AFLT Stock Dashboard (traded in RUB)

CurrencyUSD 1 = RUB 73.45 P/E7.2
Jan 15 closeRUB72.30SectorAirlines
Ave Daily Volume22,935,228 sharesShares Outstanding1,062,800,000
52-Week Range (In RUB)51.02 - 121.64Market CapRUB76.8 billion [$1 billion]

AERAY ADR Dashboard (traded in $)

Home ExchangeRussiaTypeSponsored
CodeAERAYJan 15 close$4.50
ISINUS69343R1014Ave Daily Volume3,433 ADRs
CUSIP69343R10152-Week Range (In USD)3.20 - 8.60
Ratio1 ADR equals 5 ordinary shares

AFLT Financials Summary:

+ Net profit was down 53.4% from $308 million in FY2017 to $143.4 million in FY2019.

+ Earnings Per Share (EPS) was down 53.1% from RUB21.30 in FY2017 to RUB10.0 in FY2019 in the 2-year period.

Year ended DecFY2019FY2018FY2017
Sales ($ B)9.18.27.2
Pretax ($ M)185.9(899.9)454.2
Net ($ M)143.4(732.1)308
EPS (RUB)10(49.6)21.3

INDEX

SECTION 1 Recent News

SECTION 2 Corporate Profile

SECTION 3 Today's Bearish Signals

SECTION 4 Ongoing Bearish Parameters

SECTION 5 Today's Bullish Signals

SECTION 6 Ongoing Bullish Parameters

SECTION 7 Peer Group Analysis & Ranking

SECTION 8 Currency Synopsis: Russian Ruble (RUB)

SECTION 9 Credit Rating Summary

Glossary

DATA DOWNLOAD CENTER

AFLT: EXCEL TABLES ARE AVAILABLE TO EXPORT DATA:

+ PRICE VOLUME - 5-YEAR HISTORY

+ PEER COMPARISON - STOCK IN INDICES

AFLT: LINKS IN HTML TO FURTHER INFORMATION:

+ PRICE VOLUME CHARTS IN HTML

+ USD vs RUB EXCHANGE RATE CHARTS IN HTML

SECTION 1 Recent News

1.1 FY 2020

Aeroflot - Russian Airlines continues downtrend, crashes 31.2% in 2020

Aeroflot - Russian Airlines (MICEX:AFLT), Russia's largest Airline company by market cap, has tumbled RUB32.42 (or 31.2%) in 2020 to close at RUB71.44. Compared with the MOEX Russia Index which has risen 8.0% in 2020, this is a relative price change of -39.2%.

The stock is amongst the bottom 4% of Russia-listed stocks in 2020. Market Capitalization has slumped by RUB39.4 billion ($536.2 million) to RUB75.9 billion ($1 billion).

Average daily volume of 19.5 million shares in 2020 was 5.1 times the average daily volume in 2019.

SECTION 2 Corporate Profile

2.1 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.

2.2 Contact Details

Websitehttp://www.aeroflot.ru
Physical AddressArbat Strasse 10 Moscow, 119002 Russian Federation
Phone+7-495-1556643
Fax+7-495-7529028

2.3 Industry & Sector

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

SECTION 3 Today's Bearish Signals

3.1 Momentum Down 0.6% Past Week

Aeroflot - Russian Airlines underperformed the MICEX Index in 4 out of 5 days. The price ranged between a low of RUB72.96 on Wednesday, Jan 06 and a high of RUB74.18 on Tuesday, Jan 12.

DayAeroflot - Russian AirlinesClose price [RUB]Price change %Relative change % *Comment
ThursdayOffers 14th lowest Price Earnings in MOEX Russia Index, after price drop73.16-1.4-2.0Steepest Fall
TuesdayRises for an eighth consecutive day, an eight-day rise of 7.5%74.180.10.4Week-high of 74.18
MondayOffers 13th lowest Price Earnings in MOEX Russia Index, despite price rise74.080.7-0.1VI*=1.1
FridayIn 6th consecutive rise, nears one-month high73.580.8-1.6Top Rise
WednesdayOffers 13th lowest Price Earnings in MOEX Russia Index, despite price rise72.960.3-0.05Week-low of 72.96

* Relative change is price change of stock with respect to Benchmark Index, MICEX Index.

[Volume Index (VI); 1 is average]

3.2 Rank in the bottom 20% by Price Performance in the Russian market

DescriptionValueRank
1-week Price Change %-1.7In Bottom 20%
PV1000 [1 yr] $542In Bottom 5%
Rel Strength 6 mo3In Bottom 2%

3.3 Downtrend

Price/Moving Average Price of 0.87:

- In the past 200 days this ratio has been under 0.87, 121 times suggesting further downside. The 50-day MAP of RUB68.71 is lower than the 200-day MAP of RUB83.42, another bearish indicator.

- The price to 200-day MAP ratio is 0.87, a bearish indicator.

Trailing Relative Strength (6 months) at 3 percentile:

- The stock has a 6-month relative strength of 3 in the Russian market of 155 stocks and 40 preference stocks indicating it is trailing 97% of the market.

3.4 Overbought/Bearish Signals:

- The Relative Strength Index (RSI) of 71.5 has penetrated the overbought line of 70, suggesting the price gain of 5.2% in the last 14 days is unusually high.

- The Stochastic indicator of 89.7 has broken through the overbought line of 80; this indicates the price is close to its 14-day high and is likely to revert to a downtrend.

SECTION 4 Ongoing Bearish Parameters

4.1 Rank in the bottom 9% by Performance in the Russian market

DescriptionValueRank
Net Profit Margin %2.0In Bottom 9%

4.2 Rank in the bottom 22% by Productivity in the Russian market

DescriptionValueRank
Return on Assets [ROA] %1.4In Bottom 22%
Return on Capital Employed [ROCE] %2In Bottom 8%

4.3 Present Value of RUB1000 Invested in the Past [1 Yr, 3 Yrs]; The Worst Periods with PVRUB1000 < 653

PVRUB1,0001 yr ago3 yrs ago
AFLT.MICEXRUB652RUB636
Airlines sectorRUB679RUB518
MOEX Russia IndexRUB1,101RUB1,527

4.4 The Worst Periods [1 Yr, 3 Yrs] with Price Change % < -34.7

3-Year price change of -43.7% for Aeroflot - Russian Airlines underperformed the change of 52.7% in the MICEX Index for a relative price change of -96.4%.

Price Change %Year3 Years
Aeroflot - Russian Airlines-34.8-43.7
Airlines sector-31-47.8
MICEX Index10.252.7

4.5 Moving Annual Return of -34.8% in the past year:

Moving Annual Return was -34.8% in the past year. Based on a dynamic start date of 5 years ago, the real rate of return has averaged 30.1%. The Moving Annual Return has been negative in 3 out of 5 years.

AFLTClose (RUB)Dividends (RUB)Capital Gain / (Loss) %% YieldAnnual Return %
Jan 1572.3-(34.8)-(34.8)
1 Yr ago110.922.697.32.69.9
2 Yrs ago103.3912.81(19.5)10(9.5)
3 Yrs ago128.42-(7.1)-(7.1)
4 Yrs ago138.25-191.9-191.9

Close 5 years ago RUB47.36

4.6 MCap: 3-Year Decrease of RUB84 billion [$1 billion]

In the past 3 years Market Capitalization has decreased by RUB84.3 billion (52%) from RUB161.2 billion to RUB76.8 billion. Based on a dynamic start date of 3 years ago, there have been declines in MCap in 2 out of 3 years.

PriceMCap (RUB B)MCap ($ M)
LastRUB72.3076.81,046.1
1 Year agoRUB110.92123.22,018.2
2 Years agoRUB103.39117.91,758
3 Years agoRUB128.42161.22,848.8

4.7 Annualised Period-based Total Shareholder Returns [TSR %]: The Worst Periods with TSR < 1.3%

TSR %1 yr3 yrs10 yrs
AFLT.MICEX-34.8-13.91.2

4.8 Thinly traded stock: Days Untraded

Past five years, 12 months ended Jan 15

YearDays Untraded
20216
20209
20197
20186
20175

Liquidity has deteriorated from 5 Days Untraded five years ago to 6 days in the past year.

4.9 Satisfies 4 out of 9 criteria of Joseph Piotroski [pass mark 5]:

- Positive net income.

- Positive operating cashflow.

- Good quality of earnings [operating cashflow exceeds net income].

- Reduction in total shares on issue.

SECTION 5 Today's Bullish Signals

5.1 Rank in the top 17% by Relative Valuation in the Russian market

DescriptionValueRank
Price to Sales0.1In Top 2%
Earnings Yield %13.8In Top 8%
Cash to MCap %21.9In Top 17%

5.2 Uptrend

Beta > 1 combined with price rise. The Beta of the stock is 1.2.

Positive MACD:

- The Moving Average Convergence Divergence (MACD) indicator of 12-day Exponential Moving Average (EMA) of 72.18 minus the 26-day EMA of 71.94 is positive, suggesting a bullish signal.

5.3 Undervaluation

Price/Earnings:

Aeroflot - Russian Airlines stock is trading at the eighth lowest P/E multiple in the MOEX Russia Index.

Earnings Yield of 13.8% > Russian ave of 11.7% > Bond Yield of 6.0%:

- Earnings yield of 13.8% is greater than the Russian average earning yield of 11.7%.

- The earnings yield of 13.8% is 2.3 times the 10-year bond yield of 6.0%.

(All figures in %)

Earnings Yield13.8
Russian avg11.7
Bond Yield6.0

MCap/Total Assets:

- The company is cash rich with Cash to Market Capitalisation at 21.9%.

5.4 Other Bullish Signals

- Over the last 3 years average annual compound growth rate of earnings per share was 10.5%. This is considered moderate.

SECTION 6 Ongoing Bullish Parameters

6.1 Rank in the top 20% by Size in the Russian market

DescriptionValueRank
Ave daily TurnoverRUB1 billion ($14.3 million)In Top 8%
Annual RevenueRUB677.9 billion ($9.2 billion)In Top 20%

6.2 Present Value of RUB1000 Invested in the Past 3 Months; The Best Period with PVRUB1000 > 1,251

PVRUB1,0003 mo ago
AFLT.MICEXRUB1,252
Airlines sectorRUB1,182
MOEX Russia IndexRUB1,231

6.3 Past quarter: price rise of 25.2%

3-Month price change of 25.2% for Aeroflot - Russian Airlines outperformed the change of 23.3% in the MICEX Index for a relative price change of 1.9%.

Price Change %Quarter
Aeroflot - Russian Airlines25.2
Airlines sector18.2
MICEX Index23.3

6.4 Annualised Period-based Total Shareholder Returns [TSR %]: The Best Period with TSR > 11.4%

TSR %5 yrs
AFLT.MICEX11.5

6.5 Improved EBIT Margins:

EBIT margin is positive and has increased from -10.9% to 2.0% in the past year.

FYEBIT Margins (%)
20192.0
2018-10.9
20176.3
201610.7
20130.2

6.6 Increased Volume, up 526% in 5 years

In the past five years, Average Daily Volume of Trading (ADVT) has increased 525.5% to 22.9 million shares.

Avg. Daily Volume Traded 12 months ended Jan 15, million shares

YearADVT
202122.9
20204.0
20195.2
20184.2
20173.7

6.7 Increased VWAP

In the past five years Volume Weighted Average Price (VWAP) has increased by 2.3% to RUB75.34. .

Past five years, 12 months ended Jan 15 (RUB)

YearHigh PriceVWAPLow Price
2021121.6475.3451.02
2020112.8101.8387.39
2019146.34116.7887.15
2018197.67143.95120.58
2017143.4573.6544.32

6.8 Increased share turnover, up 521% in 5 years

In the past five years, average daily share turnover has increased 520.7% to RUB1.6 billion ($22.5 million). This suggests increased liquidity.

Past five years, 12 months ended Jan 15 (RUB billion)

YearAverage Daily Turnover
20211.6
20200.4
20190.59
20180.6
20170.27

6.9 Satisfies two criteria of Benjamin Graham

- "An earnings-to-price yield of at least twice the triple-A bond"; the stock's earning yield of 13.8% is 2.3 times the triple-A bond yield of 6.1%.

-"Total debt equal or less than twice the net quick liquidation value"; total debt of RUB74 billion (US$1.2 billion) is 1 times the net liquidation value of RUB72.81 billion (US$1.2 billion).

SECTION 7 Peer Group Analysis & Ranking

7.1 Global Peer Group (all figures in $): Key Financials

In its Global Peer Group of 9 companies AFLT is ranked second by Revenue, Total Assets, fourth by Net Profit, fifth by MCap, seventh by PV $1000 (1 yr) and eighth by Relative Str. (6 mo).

Name (Code)Relative Str. (6 mo)MCapPV $1000 (1 yr)RevenueNet ProfitTotal Assets
Rank of AFLT857242
Aeroflot - Russian Airlines (AFLT)221B541.69.2B145M12.7B
Vietnam Airlines JSC (HVN)541.9B956.54.2B100M3.3B
Senko (9069)691.5B1,242.15.5B116.5M3.4B
Nikkon Holdings Co (9072)531.5B956.61.9B161.3M2.9B
Gol Linhas Aereas Inteligentes Preference Shares (GOLL4)201.2B473.42.4B210M2.1B
Sakai Moving Service (9039)381B824.4972.8M86.3M899.3M
Exchange Income (EIF)82955.8M1,024.5946.3M55.7M1.5B
Latam Airlines Group (LTM)45921M179.19.9B181.9M17.6B
SpiceJet (500285)88734.3M831.81.2B(41.3M)655.3M

Global Peer Group: Relative Value Indicators

AFLT is ranked first by P/S and second by P/E, Turnover Rate.

Name (Code)Country CodeLast PriceP/EP/SP/BookTurnover Rate (%)% Disc to 52-w Hi
Rank of AFLT212
Aeroflot - Russian Airlines (AFLT)RURUB72.307.30.1427.439.9
Vietnam Airlines JSC (HVN)VNVND30,850.00.52.414.26.7
Senko (9069)JPJPY983.012.40.31.251.75.4
Nikkon Holdings Co (9072)JPJPY2,180.08.60.844.916.9
Gol Linhas Aereas Inteligentes Preference Shares (GOLL4)BRR$23.47716.740.2
Sakai Moving Service (9039)JPJPY5,130.014.41.11.735.622.5
Exchange Income (EIF)CACAD37.7116.88.0110.012.2
Latam Airlines Group (LTM)CLCLP1,214.505.6173.583.5
SpiceJet (500285)INRs89.6034.015.5

7.2 BuySellSignals Fundamentals Valuation Ranking: Aeroflot - Russian Airlines vs Russian Market

Out of 155 stocks in the Russian Market, Aeroflot - Russian Airlines is ranked first by P/Sales, sixteenth by P/Earnings, Twenty-second by Discount to 52-Wk High and Fifty-first by Net Profit $.

Russian AvgAFLTRankRank 1Rank 2Rank 3Lowest Rank
P/Sales1.1x0.1x10.1x MTLR0.1x AFLT0.1x ROST-
P/Earnings8.5x7.2x162.3x NMTP3.2x FEES3.4x RNFT-
Discount to 52-Wk High (%)2.240.62262.95 TUCH54.4 RLMN49.1 TASBP0.8 MRKZ
Net Profit $1.2 B145 M5119.8 B GAZP11.8 B NVTK9.6 B ROSN(826.5 M) UTAR
Premium to 52-Wk Low (%)95.9641.7574.5 RLMN5.6 ENRU6.2 PLZL391.8 MAGE
ROA (%)7.41.414263.4 ALNU43.9 NVTK31.3 NMTP0.01 KBTK
EBITDA Margin%14.7(13.8)20683.2 ODVA67.98 SFIN61.1 SBER(63.5) UTAR

Negative values are shown in brackets.

7.3 Share in Index

Aeroflot - Russian Airlines is a constituent of the following indices. Its market capitalisation accounts for 0.2% of the combined MCap of the RTS Index.

Index NameMCap of Index ($ B)MCap as % of Index
RTS Index600 0.2
MOEX Russia Index613 0.2

7.4 Global Rank [out of 47,979 stocks] and Rank of Aeroflot - Russian Airlines in the Europe Region [out of 7,619 stocks]

DescriptionValueGlobal RankIn Eur Region
MCap ($)1B8,6911,522
Total Assets ($)12.7B2,528501
Revenue ($)9.2B1,533332
Net Profit ($)145M4,365910
Net Profit Margin %2.022,6303,477
Price/Earnings7.33,176515
PV1000 (1Year) $*54238,8296,546
$* Change (1Year) %-44.038,2776,529

* 1 year ago $1 = RUB 61.04

Jan 15, 2021: $ 1 equals RUB 73.45

7.5 Rank of Aeroflot - Russian Airlines in the MICEX Index [out of 34 stocks] and in the Total Russian Market [out of 220 stocks]

DescriptionValueIn MICEX IndexIn Total Russian Market
MCap (RUB)76.8B3362
Total Assets (RUB)933.3B1316
Revenue (RUB)677.9B1113
Net Profit (RUB)10.6B2541
Net Profit Margin %2.02993
Price/Earnings7.2951
PV1000 (1Year) RUB65225185

7.6 Long-Term Fundamental Ranking: 3 out of 5 [5 is best]

Aeroflot - Russian Airlines is ranked number 1 out of 3 listed airline in the Russia with a market capitalization of RUB76.8 billion ($1 billion).

Within its sector it has a relatively moderate P/E of 7.2 and moderate Price/Sales of 0.1.

Stocks are scored on a set of parameters reflecting fundamental analytical tools involving valuation, size and financial performance. They are ranked according to the average values of those parameters. The highest ranking is 5 and the lowest ranking is 1.

SECTION 8 Currency Synopsis: Russian Ruble (RUB)

Currency Synopsis: Russian Ruble (RUB)

SECTION 9 Credit Rating Summary

Russia:

Rating AgencyLong TermForeign CurrencyDescription
FitchBBB-
Moody'sBaa3
S&PBBB-Considered lowest investment grade by market participants. The minus (-) sign shows relative standing within the major rating category.
FITCHBBB-Good credit quality: 'BBB' ratings indicate that expectations of default risk are currently low. The minus (-) sign shows relative standing within the major rating category.
DAGONGAHigh Credit Quality: "A" ratings denote expectations of relatively low default risk. The capacity for payment of financial commitments is considered sufficient. However, this capacity may be more vulnerable than those of the higher ratings to adverse business or economic conditions due to any foreseeable event.

Glossary

ADVT: Average Daily Volume of shares Traded

Annual Return: Dividends Paid In a 12-Month Period/Price at the Beginning of the Period + Capital Gain or Loss over 1 Year/Price 1 Year Ago (%)

Cash/MCap: Cash plus Liquids/Market Capitalisation (times)

Current Ratio: Current Assets/Current Liabiliites (times)

EBIT Margin : Earnings Before Interest and Tax/Revenue (%)

Earnings Yield: Earnings Per Share/Share Price (%)

Moving Average Price (n periods): Sum of Prices for each Period/Number of Periods

PV1000: Present value of 1000 invested 1 year/'n' years ago

Price/Earnings: Share Price/Earnings Per Share (times)

Price/Sales: Share Price/Sales Per Share (times)

Relative Price Change [RPC]: Relative price change is price change of stock with respect to Benchmark Index

Relative Strength (6 Months): Price close today/Price close 6 months ago, then ranked by percentile within the entire market.

Return on Assets: Net Profit/Total Assets (%)

Return on Equity (Shareholders' Funds): Net Profit/Net Assets (%)

TSR: Total Shareholder Returns is expressed as an annualized rate of return for shareholders after allowing for capital appreciation and dividend

Turnover Rate: value of annual trading volume as a percentage of market capitalisation

Volume Index (VI): Number of shares traded in the period/Average number of shares traded for the period

Volume Weighted Average Price (VWAP): The Volume Weighted Average Price (VWAP) is the summation of turnover divided by total volume in the same period.

Created by www.buysellsignals.com