Bank of America Securities: Domestic ticket prices are expected to be pressured and profits are expected to “outperform the market” by the three major airline H stocks

The Zhitong Finance App learned that Bank of America Securities released a research report saying that the performance of the four mainland airlines in the third quarter was divided. Among them, China Eastern Airlines (00670) had the strongest net profit growth, up 34% year on year; followed by China Southern Airlines (01055), which increased 20% year on year. As for Spring Airlines (601021.SH) and Air China (00753), net profits fell 6% and 11%, respectively. Revenue performance per available seat kilometer during the period was better than expected, and the September data was steady. The bank expects the reduction in fuel costs to benefit the overall cost structure, and the unit cost performance after excluding fuel varies, and China Airlines lags behind in cost optimization.

The bank adjusted Air China's profit forecast for 2025 from a loss of 54 million yuan to a profit of 473 million yuan, and lowered the 2026 and 27 forecasts by 5.7% and 4.2%. Additionally, China Southern Airlines' profit forecast for 2025 was lowered by 54%, and the 2026 and 27 forecasts were raised by 16% and 14%, respectively; Eastern Airlines increased its 2025-27 forecast by 56%, 0.8%, and 0.7%. As for Spring Airlines, the profit forecast for 2025 was lowered by 2.7%, and the forecast for 2026 and 27 remains unchanged.

The bank reaffirmed the “underperforming” rating of Air China, China Eastern Airlines and China Southern Airlines, as domestic fares are still under pressure, posing a downside risk to profits in 2025 and 26; at the same time, it also reaffirmed its “buy” rating for Spring Airlines due to its cost leadership position and expected steady growth from 2025 to 26.