Assessing Air China (SEHK:753) Valuation After Its First Quarter Profit Turnaround

Simply Wall St.05-11

Air China (SEHK:753) has drawn fresh attention after reporting first quarter 2026 earnings, shifting from a CNY 2,043.99 million net loss a year ago to net income of CNY 1,714.1 million. See our ...

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See our ...</p>\n\n<a href=\"https://simplywall.st/stocks/hk/transportation/hkg-753/air-china-shares/news/assessing-air-china-sehk753-valuation-after-its-first-quarte\">Source Link</a>\n\n</div>\n","source":"simplywall_highlight","html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Assessing Air China (SEHK:753) Valuation After Its First Quarter Profit Turnaround</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nAssessing Air China (SEHK:753) Valuation After Its First Quarter Profit Turnaround\n</h2>\n\n<h4 class=\"meta\">\n\n\n2026-05-11 04:26 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://simplywall.st/stocks/hk/transportation/hkg-753/air-china-shares/news/assessing-air-china-sehk753-valuation-after-its-first-quarte><strong>Simply Wall St.</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Air China (SEHK:753) has drawn fresh attention after reporting first quarter 2026 earnings, shifting from a CNY 2,043.99 million net loss a year ago to net income of CNY 1,714.1 million. See our ...</p>\n\n<a href=\"https://simplywall.st/stocks/hk/transportation/hkg-753/air-china-shares/news/assessing-air-china-sehk753-valuation-after-its-first-quarte\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"BK1505","symbol_name":"一带一路","start_time":0,"source_url":"https://simplywall.st/stocks/hk/transportation/hkg-753/air-china-shares/news/assessing-air-china-sehk753-valuation-after-its-first-quarte","article_id":"2634422514","we_media_id":null,"thumbnails":["https://images.simplywall.st/asset/industry/3221000-choice2-main-header/1585186666788"],"rights":{"source":"simplywall_highlight","url":"https://simplywall.st/stocks/hk/transportation/hkg-753/air-china-shares/news/assessing-air-china-sehk753-valuation-after-its-first-quarte","rn_cache_url":null,"directOrigin":true},"url":"https://stock-news.laohu8.com/highlight/detail?id=2634422514","pubTimestamp":1778444814,"columns":[],"sourceInfo":{"source_id":"simplywall_highlight","name":"Simply Wall St."},"weMediaInfo":null,"summary":"Air China (SEHK:753) has drawn fresh attention after reporting first quarter 2026 earnings, shifting from a CNY 2,043.99 million net loss a year ago to net income of CNY 1,714.1 million.\nSee our latest analysis for Air China.\nThe earnings swing back to profit appears to have caught investors’ attention, with a 13.43% 7 day share price return and an 8.13% 30 day share price return. However, the 90 day share price return of a 28.69% decline shows longer term momentum has been weaker, while the...","collect":0,"end_time":0,"defaultTopTitle":"simplywall.st","property":[],"viewcount":null,"language":"en","relate_stocks":{"BK1505":"一带一路","BK1123":"航空公司","00753":"中国国航","BK1561":"航空股","BK1514":"人民币升值概念","DCF":"Dreyfus Alcentra Global Credit Income 2024 Target Term Fund, Inc"},"translate_title":"评估国航(SEHK：753)第一季度盈利扭亏为盈后的估值","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"00753":0.9,"DCF":1},"content_text":"Air China (SEHK:753) has drawn fresh attention after reporting first quarter 2026 earnings, shifting from a CNY 2,043.99 million net loss a year ago to net income of CNY 1,714.1 million. See our latest analysis for Air China. The earnings swing back to profit appears to have caught investors’ attention, with a 13.43% 7 day share price return and an 8.13% 30 day share price return. However, the 90 day share price return of a 28.69% decline shows longer term momentum has been weaker, while the 1 year total shareholder return of 8.79% contrasts with negative total shareholder returns over three and five years. If this turnaround has you rethinking your portfolio, it could be a good moment to look at other potential growth stories through our screener of 99 top founder-led companies With the stock trading at HK$5.32 and shown at a discount to both analyst price targets and an intrinsic value estimate, the key question is whether this represents a genuine opportunity or if the market is already pricing in future growth. AdvertisementPrice to earnings of 40.4x: Is it justified? Air China trades on a P/E of 40.4x, which sits alongside a last close of HK$5.32 and reflects a richer valuation than many peers. The P/E ratio compares the current share price to earnings per share, so a higher figure usually signals that the market is pricing in stronger profit expectations. For Air China, the picture is mixed. On one side, earnings are forecast to grow 59.8% per year, and the stock trades around 56.3% below the HK$12.18 fair value implied by the SWS DCF model. On the other side, the current 40.4x P/E is much higher than both the Asian Airlines industry average of 10.1x and the peer average of 21x, even if it is closer to the estimated fair P/E of 44.8x that the market could move towards if those earnings forecasts are met. Compared with industry and peer benchmarks, the market is putting a premium price on Air China's earnings, and that premium is only partly tempered by the fair P/E estimate of 44.8x that suggests the current multiple is not wildly out of line with what the underlying numbers support. Explore the SWS fair ratio for Air China Result: Price-to-earnings of 40.4x (ABOUT RIGHT) However, the weak 90 day and multi year shareholder returns, along with the relatively high P/E, leave little room if profit trends or sentiment do not support the current pricing. Find out about the key risks to this Air China narrative. Another View: Cash Flows Tell a Different Story The P/E of 40.4x looks expensive next to the Asian Airlines industry at 10.1x and peers at 21x. However, the SWS DCF model points to an intrinsic value of HK$12.18, which is well above the current HK$5.32 price. This raises the question of whether the market is overpaying based on earnings or underestimating long term cash flows. Look into how the SWS DCF model arrives at its fair value. 753 Discounted Cash Flow as at May 2026Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Air China for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 231 high quality undervalued stocks. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity. Next Steps Looking at the mixed signals so far, the key question is how you weigh the risks against the potential rewards and what that means for your portfolio. To see both sides clearly and decide where you stand, take a closer look at the 3 key rewards and 1 important warning sign Looking for more investment ideas? If this earnings story has sharpened your focus, do not stop here. Broaden your watchlist with structured ideas built from consistent, data driven filters.  Spot potential value opportunities early by reviewing companies highlighted in our 231 high quality undervalued stocks. Strengthen your income plan by scanning stocks in the 481 dividend fortresses. Prioritise resilience by focusing on companies featured in the 306 resilient stocks with low risk scores.   This article by Simply Wall St is general in nature. We provide commentary based on historical data\n        and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your\n        financial situation. We aim to bring you long-term focused analysis driven by fundamental data.\n        Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.\n        Simply Wall St has no position in any stocks mentioned.New: Manage All Your Stock Portfolios in One PlaceWe've created the ultimate portfolio companion for stock investors, and it's free.• Connect an unlimited number of Portfolios and see your total in one currency• Be alerted to new Warning Signs or Risks via email or mobile• Track the Fair Value of your stocksTry a Demo Portfolio for FreeHave feedback on this article? Concerned about the content? Get in touch with us directly. 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