SGX-listed SIA Engineering Company Limited (SG:S59) is set to commence its fiscal year 2024 earnings with the release of its first-quarter report scheduled for July 21. The company’s stock has a Strong Buy rating from analysts on TipRanks.
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SIA Engineering offers comprehensive aircraft maintenance, repair, and overhaul (MRO) services to over 80 international airlines across the globe.
Analysts’ View
In its financial year 2023, there was a notable rebound in in-flight activities, marking the strongest recovery since the onset of the pandemic. The lifting of border restrictions contributed to this recovery, as flight activities gradually regained momentum throughout the year. The robust recovery has generated increased demand for maintenance, repair, and overhaul services. As a result, revenue growth was observed across all business units of the company as business volume expanded.
Moving forward, the pace of the recovery is anticipated to be slower compared to the previous year. On the other hand, potential headwinds to the ongoing recovery include an economic slowdown, supply chain challenges, and increased inflationary costs.
Analysts are bullish as the overall outlook for the aviation sector is positive, which bodes well for the company’s prospects. The outlook was further strengthened by the last earnings season’s favorable numbers. Analysts also believe the improving fundamentals have yet to be fully reflected in the share prices and valuations of the company.
SIA Engineering Share Price Target
Based on the analyst consensus from TipRanks, S59 stock has a Strong Buy rating, backed by three Buy recommendations.
At an average target price of S$2.75, analysts are projecting a growth of 11.7% from the current level.
