Air Arabia Climbs as U.A.E. Passenger Traffic Jumps
Air Arabia PJSC (AIRARABI) gained the most in almost two weeks on bets the United Arab Emirates low-cost carrier will benefit from a jump in passenger traffic through the country’s airports.
Shares of airline, which is based in the U.A.E. emirate Sharjah, advanced 3.2 percent, the most since July 17, to 1.30 dirhams at the close in the emirate. Almost 34 million shares were traded. The stock was the second-biggest gainer on the benchmark DFM General Index (DFMGI), which rose 0.3 percent. The carrier is expected to report earnings on Aug. 8, according to data compiled by Bloomberg.
Dubai, which plans to double the number of visitors to 20 million by 2020, posted an 18 percent advance in passenger traffic through its airport in June, according to data released today. Air Arabia said last month it plans to start flights to the Armenian capital of Yerevan in August, the fifth new route this year and its 86th globally, from hub in Sharjah, which neighbors Dubai, as well as Egypt and Morocco.
“We expect investors are accumulating the stock prior to second-quarter results,” said Tariq Qaqish, head of asset management at Dubai-based Al Mal Capital PSC. “The results will continue to show strong passenger growth, solid load factor and better revenue per passenger.”
Air Arabia may post a 3.3 percent increase to 67.2 million dirhams ($18 million) in second-quarter profit, according to an estimate from Securities & Investments Co. Its full-year profit will probably 9 percent to 457.9 million dirhams, according to the mean estimate of eight analysts compiled by Bloomberg.
Nine analysts recommend investors buy the shares, while five have a hold rating on the stock, according to data compiled by Bloomberg.
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