Grupo Aeroportuario del Sureste S.A.B. de C.V. – Ticker: ASR (ADR – NYSE), ASURB (Mexico)

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1. Executive Summary

  • Company: Grupo Aeroportuario del Sureste S.A.B. de C.V.
  • Ticker: ASR (ADR – NYSE), ASURB (Mexico)
  • Sector: Airport Operations & Infrastructure
  • Investment Recommendation: Hold – Strong profitability and dividends, but subject to macro and regulatory risks.

2. Company Overview

  • Business Model: Operates 16 airports across southeastern Mexico, Puerto Rico, and Colombia. Revenue comes from airport services, security, airline fees, and commercial leasing.
  • Industry Position: One of Mexico’s top 3 airport operators, with a flagship asset in Cancún International Airport. Strong position in Latin America’s air travel infrastructure.
  • Key Products/Services: Airport operations, terminal management, retail space leasing, security services, FBO (general aviation), and related infrastructure.
  • Management: CEO: Adolfo Castro Rivas, Chairman: Fernando Chico Pardo. Stable leadership with consistent execution.

3. Financial Analysis

  • Revenue Growth:
    • 2024 revenue: MXN 31.3B (+21.3% YoY).
    • April 2025 traffic: Mexico +0.5%, Colombia +4.8%, Puerto Rico +13.5% YoY.
  • Profitability:
    • Net income in 2024: MXN 13.5B (+32.8%).
    • Net margin ~42.8%; operating margin ~58.0%.
  • EPS Trends:
    • 2024 EPS rose significantly due to traffic and pricing growth.
    • Beat analyst expectations.
  • Balance Sheet:
    • Debt/equity ratio: ~22.4%, long-term debt at 20.7% of capital.
    • Assets: ~US$4.16B; net debt negative – strong net cash position.
  • Cash Flow:
    • 2024 free cash flow (FCF): ~MXN 11.2B.
    • Strong FCF despite capex for modernization/expansion.

4. Stock Performance

  • Price:
    • ADR (ASR): ~$323.90 USD (52-week range: $251–$344).
    • Mexico (ASURB): ~MXN 619.57 (−10.3% from 52-week high).
  • Dividend:
    • Projected dividend for 2025: MXN 50/share → ~5–8% yield.
  • Volatility:
    • Moderate, influenced by global macro trends (rates, tourism).

5. Valuation Analysis

  • P/E (TTM): ~13.3×
  • P/S: ~5.3×
  • P/B: ~2.98×
  • P/FCF: Reasonable, considering consistent cash generation.
  • Overall valuation is slightly above historical average but justified by strong margins.

6. Industry & Market Analysis

  • Trends:
    • Post-pandemic travel boom, airport modernization, digital and green investments.
  • Market Share:
    • #3 in Mexico; strong in tourism-heavy markets like Cancún.
  • Macro Factors:
    • Sensitive to inflation, oil prices, exchange rates.
    • Exposed to U.S.–Mexico travel policies and regulatory developments.

7. Risk Analysis

  • Market Risk:
    • Sensitive to travel slowdowns, health emergencies.
  • FX Risk:
    • Currency fluctuation affects ADR investors.
  • Policy Risk:
    • Mexican government airport fee regulations and operational licenses.
  • Operational Risk:
    • High capex could affect margins if passenger growth stalls.

8. Growth Catalysts

  • Traffic growth continues (notably in Puerto Rico).
  • Investments in terminals, retail space, and digital infrastructure.
  • Strong dividend policy supports investor appeal.
  • Expansion in Colombia and FBO services.

9. Analyst Sentiment

  • Analyst rating: Neutral to Moderate Buy (Reuters/MarketBeat).
  • Price target: ~$310 USD for ADR, suggesting limited short-term upside.
  • Dividends and FCF remain a bullish anchor.

10. Conclusion

  • Summary: ASR is a highly profitable airport operator with excellent cash flow, low debt, and solid dividend policies. However, macroeconomic risks and government policy shifts warrant cautious optimism.
  • Recommendation:
    • Hold existing positions.
    • Consider Buy on dips, especially if FX risk subsides or traffic growth outpaces forecasts.
  • Key Watch Points:
    • Monthly traffic data
    • Quarterly earnings, dividend declarations
    • Mexican regulatory or tax changes

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