UBS rated Cathay Pacific Airways as a Buy due to a strong rebound in passenger and cargo demand, particularly benefiting from disruptions in the Middle East. The airline experienced a 22% year-over-year increase in passenger traffic, significantly outpacing capacity growth, leading to a record high passenger load factor. Despite rising jet fuel prices, UBS believes Cathay Pacific is well-positioned in the Asia-Pacific market with strong pricing power in its full-service segment, which is expected to drive revenue growth.
