China Airlines vs Air France-KLM Which Should You Buy?

China Airlines and Air France-KLM are two major players in the global airline industry, each representing significant market share in their respective regions. Both companies have faced challenges and opportunities in recent years, with fluctuations in fuel prices, competition from low-cost carriers, and changing passenger demands impacting their stock performance. Investors interested in the airline sector may find it useful to compare the financial health, growth prospects, and strategic positioning of China Airlines and Air France-KLM to make informed investment decisions.

China Airlines or Air France-KLM?

When comparing China Airlines and Air France-KLM, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between China Airlines and Air France-KLM.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. China Airlines has a dividend yield of 2.96%, while Air France-KLM has a dividend yield of -%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. China Airlines reports a 5-year dividend growth of 0.00% year and a payout ratio of 43.80%. On the other hand, Air France-KLM reports a 5-year dividend growth of 0.00% year and a payout ratio of 37.23%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with China Airlines P/E ratio at 13.59 and Air France-KLM's P/E ratio at 0.77. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. China Airlines P/B ratio is 1.72 while Air France-KLM's P/B ratio is -0.09.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, China Airlines has seen a 5-year revenue growth of 0.02%, while Air France-KLM's is 4.35%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with China Airlines's ROE at 13.45% and Air France-KLM's ROE at -11.58%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are NT$23.30 for China Airlines and $0.85 for Air France-KLM. Over the past year, China Airlines's prices ranged from NT$19.05 to NT$25.20, with a yearly change of 32.28%. Air France-KLM's prices fluctuated between $0.77 and $1.65, with a yearly change of 114.29%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.