Sydney Airport’s result was in line, with earnings up 4% on flat traffic and cash flow up 6% on a flat interest cost. The company deviated from standard practice nonetheless by not issuing FY distibution guidance, due to the as yet unkown impact of the virus.
UBS has cut its traffic and cashflow forecasts.
But the broker, too, admits the numbers are just a guess. Management pointed out SARS resulted in a -15-20% fall in traffic and February to date is tracking at -5-10%. Neutral and $8.50 target retained with a caveat of uncertainty.
Sector: Transportation.
Target price is $8.50.Current Price is $8.30. Difference: $0.20 – (brackets indicate current price is over target). If SYD meets the UBS target it will return approximately 2% (excluding dividends, fees and charges – negative figures indicate an expected loss).
This excerpt is taken from The Australian Broker Call. Copyright FN Arena, visit www.fnarena.com for a free trial. http://www.fnarena.com/ts.cfm?R=EQUITYCAFE
