What is China Airlines Financial Strength?
China Airlines has the Financial Strength Rank of 3. It displays poor financial strength and is likely in financial distress. Usually this is caused by too much debt for the company.
Warning Sign:
China Airlines Ltd displays poor financial strength. Usually, this is caused by too much debt for the company.
GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is based on these factors:
1. The debt burden that the company has as measured by its
Interest Coverage (current year). The higher, the better.
2. Debt to revenue ratio. The lower, the better.
3.
Altman Z-Score.
China Airlines's Interest Coverage for the quarter that ended in Mar. 2024 was 6.00.
China Airlines's debt to revenue ratio for the quarter that ended in Mar. 2024 was 0.48.
As of today, China Airlines's Altman Z-Score is 1.16.
Competitive Comparison of China Airlines's Financial Strength
For the Airlines subindustry, China Airlines's Financial Strength, along with its competitors' market caps and Financial Strength data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
China Airlines's Financial Strength Distribution in the Transportation Industry
For the Transportation industry and Industrials sector, China Airlines's Financial Strength distribution charts can be found below:
* The bar in red indicates where China Airlines's Financial Strength falls into.
China Airlines Financial Strength Calculation
GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is based on these factors
A company ranks high with financial strength is likely to withstand any business slowdowns and recessions.
1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.
Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.
Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income (EBIT) by its Interest Expense:
China Airlines's Interest Expense for the
months ended in Mar. 2024 was NT$-642 Mil. Its Operating Income for the
months ended in Mar. 2024 was NT$3,852 Mil. And its Long-Term Debt & Capital Lease Obligation for the quarter that ended in Mar. 2024 was NT$63,555 Mil.
China Airlines's Interest Coverage for the quarter that ended in Mar. 2024 is
The higher the ratio, the stronger the company's financial strength is.
Warning Sign:
Ben Graham prefers companies' interest coverage to be at least 5. China Airlines Ltd interest coverage is 4.78, which is low.
2. Debt to revenue ratio. The lower, the better.
China Airlines's Debt to Revenue Ratio for the quarter that ended in Mar. 2024 is
3. Altman Z-Score.
Z-Score model is an accurate forecaster of failure up to two years prior to distress. It can be considered the assessment of the distress of industrial corporations.
The zones of discrimination were as such:
When Z-Score is less than 1.81, it is in Distress Zones.
When Z-Score is greater than 2.99, it is in Safe Zones.
When Z-Score is between 1.81 and 2.99, it is in Grey Zones.
China Airlines has a Z-score of 1.16, indicating it is in Distress Zones. This implies bankrupcy possibility in the next two years.
Warning Sign:
Altman Z-score of 1.16 is in distress zone. This implies bankruptcy possibility in the next two years.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
China Airlines (TPE:2610) Business Description
Traded in Other Exchanges
N/A
Address
No. 1, Hangzhan South Road, Dayuan District, Taoyuan, TWN
China Airlines Ltd provides air transportation services. The company is composed of its flight and non-flight segments. The flight segment is the core business of the firm and offers transport services primarily for passengers and cargo. A vast proportion of the company's revenue is generated from transporting passengers in its flight operating unit. The non-flight segment provides various services such as mail and ground solutions, data processing services to other airlines, aircraft maintenance, and aircraft leasing. It engages in air transportation services for passengers, cargo and others. The company's geographical segments include America, Northeast Asia, Southeast Asia, Europe, Australia, China, and Domestic.
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