China Southern Airlines (ZNH) and The Competition Critical Analysis
China Southern Airlines (NYSE: ZNH) is one of 27 publicly-traded companies in the “Airlines” industry, but how does it weigh in compared to its competitors? We will compare China Southern Airlines to similar companies based on the strength of its earnings, analyst recommendations, profitability, institutional ownership, valuation, dividends and risk.
China Southern Airlines pays an annual dividend of $0.64 per share and has a dividend yield of 1.3%. As a group, “Airlines” companies pay a dividend yield of 1.6% and pay out 26.7% of their earnings in the form of a dividend. China Southern Airlines has raised its dividend for 2 consecutive years.
This table compares China Southern Airlines and its competitors’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|China Southern Airlines||N/A||N/A||N/A|
|China Southern Airlines Competitors||5.30%||21.35%||6.74%|
Insider & Institutional Ownership
0.5% of China Southern Airlines shares are owned by institutional investors. Comparatively, 77.7% of shares of all “Airlines” companies are owned by institutional investors. 6.1% of shares of all “Airlines” companies are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.
Earnings and Valuation
This table compares China Southern Airlines and its competitors gross revenue, earnings per share and valuation.
|Gross Revenue||Net Income||Price/Earnings Ratio|
|China Southern Airlines||$17.31 billion||$759.12 million||N/A|
|China Southern Airlines Competitors||$9.83 billion||$754.70 million||353.05|
China Southern Airlines has higher revenue and earnings than its competitors.
This is a summary of current recommendations for China Southern Airlines and its competitors, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|China Southern Airlines||1||0||0||0||1.00|
|China Southern Airlines Competitors||324||1113||2221||103||2.56|
As a group, “Airlines” companies have a potential downside of 6.19%. Given China Southern Airlines’ competitors stronger consensus rating and higher possible upside, analysts clearly believe China Southern Airlines has less favorable growth aspects than its competitors.
Volatility and Risk
China Southern Airlines has a beta of 1.21, meaning that its share price is 21% more volatile than the S&P 500. Comparatively, China Southern Airlines’ competitors have a beta of 1.23, meaning that their average share price is 23% more volatile than the S&P 500.
China Southern Airlines competitors beat China Southern Airlines on 11 of the 14 factors compared.
About China Southern Airlines
China Southern Airlines Company Limited is principally engaged in the operation of civil aviation, including the provision of passenger, cargo, mail delivery and other extended transportation services. The Company operates through two business segments, including Airline Transportation segment and Other segment. Airline Transportation segment consist of passenger and cargo and mail operations. Other segment includes hotel and tour operation, ground services, cargo handling and other miscellaneous services. . The Company also provides services of general aviation and aircraft maintenance. The Company acts as an agency of domestic and foreign airlines, and other aviation and related business, such as personal accident insurance and agency business.
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