Cathay Pacific Airways Middle East disruption creates lasting tailwinds for premium traffic; model update reinforces bullish view

Research evidence excerpt

Cathay Pacific Airways Middle East disruption creates lasting tailwinds for premium traffic; model update reinforces bullish view

Asia Pacific Equity Research

27 June 2026

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Overweight

Cathay Pacific Airways 0293.HK, 293 HK

Price (26 Jun 26): HK$12.58

Middle East disruption creates lasting tailwinds for

▼ Price Target (Jun-27): HK$16.00

premium traffic; model update reinforces bullish Prior (Dec-26): HK$18.00

view

We are updating our model for Cathay, rolling forward estimates, introducing Hong Kong

FY28, and revising our price target to HK$16. Cathay’s investment case is Infrastructure, Industrials &

fundamentally transformed versus any prior cycle, reflecting a convergence of Transport

structural improvements across balance sheet, shareholder structure, and AC Karen Li, CFA

capital return discipline. The company has emerged from the pandemic with a (852) 2800-8589

fully normalized balance sheet, robust Op-CF and FCF generation, and a clear karen.yy.li@jpmorgan.com

commitment to shareholder returns, all of which underpin a sector-leading J.P. Morgan Securities (Asia Pacific) Limited/ J.P.

ROE and dividend yield profile. Unlike previous cycles, Cathay is now Morgan Broking (Hong Kong) Limited

capturing premium demand and market share through network agility and Jenny Qiu, CFA

Hong Kong hub leverage, while maintaining disciplined capacity growth and (852) 2800 8503

jenny.qiu@jpmorgan.com

yield defense. The durability of these gains is reinforced by sticky booking

J.P.