EVA AIRWAYS Inc.

(2618 TT Equity)
Currently traded at: 39.8TWD
Market Cap: 213.5 billion TWD
P/E: 25.8x
Est P/E: 11.0x

Revenue Distribution:
Passenger Services
International Air Transport, scheduled, non-scheduled and charter flights
Cargo Services
International cargo, express, mail and parcel transportation
Other Services
In-flight duty free sales and aircraft maintenance services
Historical Analysis

⚫ 2018-2019
the stock price stays relatively stable

⚫ 2020

10/3:Affected by the epidemic, Evergreen canceled most of its flights

in China, and Japan, South Korea and Northeast Asia routes were also
 forced to adjust flights.

⚫ 2021

5/12: Taiwan stocks have been hit by rising investor concern over
further tightening measures of covid-19 and a global tech selloff that
has weighted on index heavyweight TSMC ( TSMC 4.4% )

5/27: IATA on Wednesday said global air passenger traffic is expected

to recover to 52% of pre-covid levels in 2021(China and Eva9.9%)

10/04: Asian airlines climb amid Hopes for Merck’s COVID pill(Eva
9.5%)

11/08: Asian Travel Stocks Climb as Pfizer Pill Fuels Reopening

Hopes(Eva 6.6%)

11/16:Taiwan Airline Stocks Surge Amid Record High Air Freight

Report: Air freight to the U.S. has risen to a record for urgent
shipments due to high demand(Eva9.9%)

⚫ 2022

01/23: The Russian military is on the verge of invading the Ukraine.( In

February 2022, Russia launched a full-scale invasion of Ukraine) 

02/17: as countries gradually unblock, air passenger transportation

also sees a turnaround. 

2Q22 earnings missed on surging costs. In light of markedly rising fuel

prices and depreciation of the NT dollar, which could further push up
the expense weighting of jet fuel above 30%

10/13: Taiwan officially reopened its borders and The market expects
passenger revenue to rise meaningfully on surging travel demand
post-pandemic, but EVA outperforms decline in TWSE index(EVA
8.1% )
⚫ 1Q23

1Q23 consolidated sales rose 47.6% YoY

1. Eva Airways has significantly increased flights to cope with the surge
in travel demand ,accelerating RPK recovery.

2. Tail-winded by the long CNY holiday, January 2023 RPK was 83% of
the January 2019 level.

⚫ 2Q23
High passenger ticket prices in short supply

(1) ticket prices of hot-selling flights to northeast Asia have remained

high due to airport crew shortages, keeping service supply below pre-
pandemic levels
(2) the weighting of passengers departing on international airlines
dropped from 44-46% pre-pandemic to 33% in 1Q23, encouraging
domestic airlines to raise prices amid less competition
(3) higher variable costs of passenger business post-pandemic are being
accounted for in ticket pricing.

Takeaway:

Stock price is correlated to the global event from 2018-2022, and

the fuel cost is also important factors that influence on the stock,
which is subject to the oil price. We also need to consider the
supply and the demand, because they can change the total
revenue and its distribution.