Analyzing Cebu Air (OTCMKTS:CEBUF) and Copa (NYSE:CPA)

Copa (NYSE:CPA) and Cebu Air (OTCMKTS:CEBUF) are both industrials companies, but which is the superior investment? We will contrast the two companies based on the strength of their profitability, earnings, dividends, analyst recommendations, risk, valuation and institutional ownership.

Insider and Institutional Ownership

70.1% of Copa shares are owned by institutional investors. Comparatively, 7.0% of Cebu Air shares are owned by institutional investors. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Analyst Recommendations

This is a breakdown of current recommendations and price targets for Copa and Cebu Air, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Copa	0	1	11	1	3.00
Cebu Air	0	0	0	0	0.00

Copa currently has a consensus price target of $171.73, suggesting a potential upside of 21.73%. Given Copa’s stronger consensus rating and higher probable upside, equities research analysts plainly believe Copa is more favorable than Cebu Air.

Dividends

Copa pays an annual dividend of $6.84 per share and has a dividend yield of 4.8%. Cebu Air pays an annual dividend of $0.96 per share and has a dividend yield of 204.3%. Copa pays out 39.9% of its earnings in the form of a dividend. Cebu Air pays out 30.2% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Copa has raised its dividend for 2 consecutive years. Cebu Air is clearly the better dividend stock, given its higher yield and lower payout ratio.

Valuation & Earnings

This table compares Copa and Cebu Air”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Copa	$3.77 billion	1.54	$671.65 million	$17.15	8.23
Cebu Air	N/A	N/A	N/A	$3.18	0.15

Copa has higher revenue and earnings than Cebu Air. Cebu Air is trading at a lower price-to-earnings ratio than Copa, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Copa and Cebu Air’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Copa	18.76%	26.01%	10.98%
Cebu Air	N/A	N/A	N/A

Summary

Copa beats Cebu Air on 12 of the 14 factors compared between the two stocks.

About Copa

Copa Holdings, S.A., through its subsidiaries, provides airline passenger and cargo services. The company offers approximately 375 daily scheduled flights to 82 destinations in 32 countries in North, Central, and South America, as well as the Caribbean from its Panama City hub. As of December 31, 2023, it operated a fleet of 106 aircraft comprising 76 Boeing 737-Next Generation aircraft, 29 Boeing 737 MAX 9 aircraft, and one Boeing 737-800 Boeing Converted Freighter. The company was founded in 1947 and is based in Panama City, Panama.

About Cebu Air

Cebu Air, Inc., an airline, provides international and domestic air transportation services. The company offers scheduled air travel services to passengers, as well as airport-to-airport cargo services on its domestic and international routes. It also provides ancillary services, such as cancellation and rebooking options; in-flight merchandising, including sale of duty-free products on international flights; baggage services; and travel-related products and services. In addition, the company offers line maintenance services comprising certification and mechanic assistance; technical ramp, equipment handling; water and toilet servicing; aircraft ground support equipment operation; and light maintenance aircraft checks services. As of December 31, 2023, it operated a fleet of 85 aircrafts. The company was incorporated in 1988 and is headquartered in Pasay City, the Philippines. Cebu Air, Inc. is a subsidiary of CP Air Holdings, Inc.