CGS-CIMB Warns Investors: SIA Engineering’s Profits Unlikely to Reach Pre-Pandemic Levels
April 22, 2023
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CGS-CIMB has recently issued a warning to potential investors regarding SIA ($SGX:S59) Engineering’s financial prospects. CGS-CIMB has advised investors to ‘hold’ on SIA Engineering‘s shares, as the company’s near-term profitability is unlikely to recover to its pre-pandemic levels. SIA Engineering Company Limited is a Singapore-based global aerospace and engineering solutions provider. It is involved in the provision of a spectrum of services, such as aircraft maintenance, repair and overhaul (MRO), aircraft component maintenance and engineering services, line maintenance, airframe spares distribution, and other associated engineering services. CGS-CIMB’s warning has been echoed by analysts who expect SIA Engineering’s profits to take a hit in light of the pandemic. The company has been struggling for the past few months due to the pandemic-related disruptions in operations. These disruptions have caused the company’s revenue to decrease significantly and the corresponding profits have taken a hit as well.
In addition, the continued travel restrictions have further weighed on SIA Engineering’s operational performance. The outlook for SIA Engineering appears bleak in the near term, with analysts predicting that it will take some time for the company to be able to recover from the pandemic’s impacts on its business. Therefore, CGS-CIMB has advised investors to remain cautious when considering investing in SIA Engineering’s shares.
Market Price
However, despite this minor rise in the stock, CGS-CIMB analysts have warned investors that SIA Engineering‘s profits are unlikely to reach pre-pandemic levels any time soon. The analysts have voiced concerns over the impact that the pandemic and resulting travel restrictions have had on the aviation industry, which has seen a dramatic fall in air travel. This has consequently had an adverse effect on SIA Engineering’s revenue streams as there has been a corresponding decrease in demand for their services. As such, CGS-CIMB analysts advise investors to be wary of investing in SIA Engineering’s stocks. Live Quote…
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for Sia Engineering. More…
| Total Revenues | Net Income | Net Margin |
| 664.77 | 75.07 | 11.9% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for Sia Engineering. More…
| Operations | Investing | Financing |
| -26.29 | -18.55 | -37.79 |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for Sia Engineering. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 1.94k | 243.57 | 1.5 |
Key Ratios Snapshot
Some of the financial key ratios for Sia Engineering are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| -13.4% | -0.0% | 9.7% |
| FCF Margin | ROE | ROA |
| -12.0% | 2.5% | 2.1% |
Analysis
At GoodWhale, we provide a comprehensive analysis of SIA ENGINEERING‘s financials. With our Risk Rating, you can ascertain if SIA ENGINEERING is a suitable investment in terms of its financial and business aspects. We assign a medium risk rating to the company, indicating that it is not too risky or too safe. In our examination, we have also detected 2 risk warnings in the income sheet and balance sheet of the company. To view these warnings, all you have to do is register with us. So why wait? Register with us today and gain access to our detailed analysis of SIA ENGINEERING’s financials. More…
Peers
It has a strong presence in Asia Pacific and competes with the likes of Atlas Air Worldwide Holdings Inc, Turk Hava Yollari AO, International Container Terminal Services Inc.
– Atlas Air Worldwide Holdings Inc ($NASDAQ:AAWW)
Atlas Air Worldwide Holdings Inc. is a leading global provider of outsourced aircraft and aviation operating services. It is the world’s largest provider of ACMI freighter services and also operates a fleet of B747, B767, and B777 freighters on behalf of major airlines around the globe. The company has a market cap of $2.84 billion and a return on equity of 15.36%. Atlas Air Worldwide Holdings Inc. also provides charter and ad hoc cargo services, and is a leading provider of military airlift services to the U.S. government.
– Turk Hava Yollari AO ($OTCPK:TKHVY)
Turkey’s flag carrier and largest airline, Turkish Airlines (THY) is headquartered in Istanbul. The airline flies to more than 300 destinations in over 120 countries.
As of 2022, Turkish Airlines has a market cap of $8.3 billion and a return on equity of 21.48%. The company has been profitable every year since 2010, and reported a profit of $1.1 billion in 2020.
– International Container Terminal Services Inc ($PSE:ICT)
As of 2022, International Container Terminal Services Inc has a market cap of 367.49B and a Return on Equity of 59.1%. The company operates a network of container terminals around the world and provides container handling services.
Summary
Investment analysis on SIA Engineering has been mixed. CGS-CIMB has maintained a “hold” rating on the company, citing that its near-term profitability is unlikely to return to pre-pandemic levels. Despite this, SIA Engineering has seen some success in the past, and may still be able to turn a profit in the future. Investors should continue to monitor the company and its performance for further updates.
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