Copa Holdings, S.A. (CPA) | Investment Case

1. Company Snapshot

1.a. Company Description

Copa Holdings, S.A., through its subsidiaries, provides airline passenger and cargo services.The company offers approximately 204 daily scheduled flights to 69 destinations in 29 countries in North, Central, and South America, as well as the Caribbean from its Panama City hub.As of December 31, 2021, it operated a fleet of 91 aircraft comprising 77 Boeing 737-Next Generation aircraft and 14 Boeing 737 MAX 9 aircraft.

Copa Holdings, S.A. was founded in 1947 and is based in Panama City, Panama.

Show Full description

1.b. Last Insights on CPA

Copa Holdings' recent performance was driven by strong Q2 2025 earnings, with revenue and EPS beating estimates. The company's traffic statistics showed improvement, with RPM up 6.4% and load factor rising to 86.9% in September 2025. Additionally, Copa Holdings' August 2025 traffic numbers revealed a 9.8% increase in RPM and an 88.3% load factor. The company's solid profitability and operational excellence were highlighted in its Q2 financial results. Copa Holdings' upcoming Q3 earnings release is scheduled for November 19, 2025.

1.c. Company Highlights

Last Price	118.99
Change Percentage	0.63%
Open	118.34
Previous Close	118.24
Market Cap ( Millions)	4912
Volume	174360
Year High	130
Year Low	82.54
M A 50	122.89
M A 200	108.76

FCF Yield	-5.56%
Dividend Yield	5.41%
ROE	26.39%
Debt / Equity	81.46%
Net Debt / EBIDTA	159.18%
Price To Book	1.83
Price Earnings Ratio	7.36
Price To FCF	-18.0
Price To sales	1.39
EV / EBITDA	5.65

2. Copa Holdings Delivers Strong Q3 with Robust Margin Expansion

Copa Holdings reported a robust third quarter with an operating margin of 23.2%, a 2.9 percentage point increase year-over-year, and a net margin of 19%, up 1.9 percentage points. Net profit was $173 million or $4.20 per share, representing an 18.7% and 20.1% increase, respectively. The company's capacity increased 5.8% with a load factor of 88%. The actual EPS of $4.20 beat estimates of $4.03. Revenue growth was driven by a healthy demand environment in Latin America, with load factors holding up well despite increased capacity.

Publication Date: Nov -21

                                    📋 Highlights
                                    Operating Margin Growth:
                                                Operating margin reached 23.2%, up 2.9 percentage points YoY.
Net Profit Surge:
                                                Net profit hit $173 million ($4.20/share), reflecting 18.7% and 20.1% growth respectively.
Capacity & Load Factor:
                                                Capacity rose 5.8% year-over-year with a healthy load factor of 88%.
Fleet Expansion:
                                                Delivered five 737 MAX 8 aircraft and plans to add eight more in 2026, targeting 132 aircraft by year-end 2026.
Dividend & Guidance:
                                                Fourth-quarter dividend set at $1.61/share; 2025 operating margin guidance reaffirmed at 22–23% with 8% capacity growth.

                                

Fleet Expansion and Guidance

The company took delivery of five 737 MAX 8 aircraft and added a second Boeing 737-800 freighter. Copa reaffirmed its guidance for 2025, expecting an operating margin between 22% and 23% and capacity growth of approximately 8%. The company anticipates adding eight more 737 MAX 8 aircraft in 2026, ending with a total projected fleet of 132 aircraft. As Pedro Heilbron noted, they prioritize profitable growth and have a flexible approach to managing capacity, which is expected to drive future performance.

Valuation and Dividend

The stock is currently trading at a P/E Ratio of 7.31, P/B Ratio of 1.82, and EV/EBITDA of 5.57. The Dividend Yield is 5.69%, indicating an attractive return for income-seeking investors. The company announced its fourth dividend payment of the year, $1.61 per share, on December 15. Analysts estimate next year's revenue growth at 9.4%, suggesting a positive outlook for the company's top-line performance.

Operational Efficiency and Cost Initiatives

Copa Airlines is focused on optimizing its operations, having completed half of its densification plan, which is expected to add around 6 more seats per plane. The company expects to complete the remaining 25 aircraft during 2026. Additionally, they anticipate offsetting inflation and pushing their CASM even lower through cost initiatives in 2026. With a strong business model and healthy demand in the region, Copa is well-positioned for continued success.

3. NewsRoom

Market Today: Crypto Rout, Omnicom Cuts, Nvidia--Synopsys Deal

Dec -01

Source: gurufocus.com

Does Copa Holdings Q3 Earnings Beat Justify a Buy Decision Today?

Dec -01

Source: zacks.com

Here Are Monday’s Top Wall Street Analyst Research Calls: Archer Aviation, Beta Technologies, Carvana, Chevron, MPLX, Toast, Zscaler and More

Dec -01

Source: 247wallst.com

First Look: Airbus drops, Crypto slides, Cyber Monday

Dec -01

Source: gurufocus.com

Head to Head Comparison: Copa (NYSE:CPA) and Saker Aviation Services (OTCMKTS:SKAS)

Nov -22

Source: defenseworld.net

Copa Holdings Remains A 'Strong Buy' Despite Q3 Sell-Off

Nov -21

Source: seekingalpha.com

Copa Holdings: Q3 Earnings Confirm A Rare Gem In A Tough Industry

Nov -21

Source: seekingalpha.com

Copa Holdings, S.A. (CPA) Q3 2025 Earnings Call Transcript

Nov -20

Source: seekingalpha.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (6.48%)

6. Segments

Passenger

Expected Growth: 6.5%

Copa Holdings' 6.5% passenger growth driven by increasing demand for air travel in Latin America, fueled by rising middle-class incomes, urbanization, and tourism. Additionally, Copa's strategic hub in Panama City, modern fleet, and competitive pricing strategy contribute to its market share gains.

Cargo and Mail

Expected Growth: 5.5%

Copa Holdings' Cargo and Mail segment growth of 5.5% is driven by increasing e-commerce demand, strategic partnerships with courier services, and expanded capacity in key Latin American markets. Additionally, the company's modernized fleet and efficient logistics operations enable faster and more reliable cargo transportation, further supporting growth.

Miles Redeemed

Expected Growth: 6.0%

The 6.0% growth in miles redeemed from Copa Holdings, S.A. is driven by increased travel demand, successful loyalty program enhancements, and strategic partnerships. Additionally, Copa's expanded route network, improved customer experience, and competitive redemption rates have contributed to the growth.

Frequent Flyer Program - Marketing Services

Expected Growth: 7.5%

Copa Holdings' Frequent Flyer Program - Marketing Services growth is driven by increasing loyalty program membership, strategic partnerships, and targeted marketing campaigns. Additionally, the company's strong brand reputation, expanded route network, and improved customer experience contribute to the 7.5% growth.

Other

Expected Growth: 6.8%

Copa Holdings' 6.8% growth in 'Other' segment is driven by increased demand for ancillary services, such as baggage fees and travel insurance, as well as higher revenue from cargo operations. Additionally, the company's strategic partnerships and codeshare agreements have contributed to the growth, allowing it to expand its reach and offer more services to customers.

7. Detailed Products

Passenger Transportation

Copa Holdings offers passenger transportation services through its Copa Airlines brand, providing flights to over 70 destinations in 30 countries in North, Central, and South America, and the Caribbean.

Cargo Transportation

Copa Holdings provides cargo transportation services, offering a range of cargo solutions for businesses and individuals, including express, economy, and specialized cargo services.

Aircraft Leasing

Copa Holdings offers aircraft leasing services, providing airlines with access to a fleet of modern, fuel-efficient aircraft.

Airport Services

Copa Holdings provides airport services, including ground handling, cargo handling, and airport operations, at Tocumen International Airport in Panama.

8. Copa Holdings, S.A.'s Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for Copa Holdings, S.A. is medium due to the presence of alternative modes of transportation such as buses, trains, and cars. However, air travel remains a preferred mode of transportation for many passengers, reducing the threat of substitutes.

Bargaining Power Of Customers

The bargaining power of customers for Copa Holdings, S.A. is low due to the lack of switching options for passengers. Once a passenger has booked a flight, it is difficult to change to a different airline, giving Copa Holdings, S.A. an upper hand in negotiations.

Bargaining Power Of Suppliers

The bargaining power of suppliers for Copa Holdings, S.A. is medium due to the presence of multiple suppliers of aircraft, fuel, and other essential services. However, the airline industry is highly dependent on a few large suppliers, giving them some bargaining power.

Threat Of New Entrants

The threat of new entrants for Copa Holdings, S.A. is low due to the high barriers to entry in the airline industry. Starting a new airline requires significant capital investment, regulatory approvals, and establishment of a network of routes and services.

Intensity Of Rivalry

The intensity of rivalry for Copa Holdings, S.A. is high due to the presence of several established airlines in the Latin American market. The airline industry is highly competitive, with airlines competing on price, service, and route network.

9. SWOT Analysis

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

	Value
Debt Weight	41.91%
Debt Cost	10.77%
Equity Weight	58.09%
Equity Cost	10.95%
WACC	10.88%
Leverage	72.14%

11. Quality Control: Copa Holdings, S.A. passed 5 out of 9 key points

Strong Liquidity

Low Deb

Strong Interest Coverage

Healthy Cash Flow

Operating Efficiency

Strong Return On Equity

Consistent Revenue Growth

Consistent Operating Cash Flow Growth

Margin Improvement

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Aena

A-Score: 7.5/10

Value: 6.7

Growth: 7.1

Quality: 8.2

Yield: 6.9

Momentum: 6.5

Volatility: 9.3

1-Year Total Return ->

Copa

A-Score: 6.8/10

Value: 6.2

Growth: 4.5

Quality: 5.8

Yield: 7.0

Momentum: 8.0

Volatility: 9.3

1-Year Total Return ->

TransDigm Group

A-Score: 6.4/10

Value: 3.0

Growth: 7.9

Quality: 6.7

Yield: 9.0

Momentum: 4.0

Volatility: 8.0

1-Year Total Return ->

PACCAR

A-Score: 6.0/10

Value: 3.7

Growth: 6.7

Quality: 6.1

Yield: 8.0

Momentum: 3.0

Volatility: 8.3

1-Year Total Return ->

Ryanair

A-Score: 6.0/10

Value: 5.3

Growth: 7.8

Quality: 6.6

Yield: 1.2

Momentum: 8.5

Volatility: 6.3

1-Year Total Return ->

BAE Systems

A-Score: 5.7/10

Value: 2.4

Growth: 6.9

Quality: 4.8

Yield: 4.4

Momentum: 9.5

Volatility: 6.3

1-Year Total Return ->

Peers Metrics

12.e Scoring ^Insights

12.f DCF ^BETA

Parameters

Short Term Growth

40.24%

Short term Time

10.0

Long-Term Growth

2.00%

WACC

10.88%

Copa Holdings, S.A. - PAP310761054

1. Company Snapshot

1.a. Company Description

1.b. Last Insights on CPA

1.c. Company Highlights

Less Volatile

Higher Yield

Better Quality

Earnings Beats

Revenues Beats

Revenues Miss

Strong Momentum

Expensive

2. Copa Holdings Delivers Strong Q3 with Robust Margin Expansion

Fleet Expansion and Guidance

Valuation and Dividend

Operational Efficiency and Cost Initiatives

3. NewsRoom

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (6.48%)

6. Segments

Passenger

Expected Growth: 6.5%

Cargo and Mail

Expected Growth: 5.5%

Miles Redeemed

Expected Growth: 6.0%

Frequent Flyer Program - Marketing Services

Expected Growth: 7.5%

Other

Expected Growth: 6.8%

7. Detailed Products

Passenger Transportation

Cargo Transportation

Aircraft Leasing

Airport Services

8. Copa Holdings, S.A.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Bargaining Power Of Customers

Bargaining Power Of Suppliers

Threat Of New Entrants

Intensity Of Rivalry

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

11. Quality Control: Copa Holdings, S.A. passed 5 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

118.99$

Current Price

118.99$

Potential

-0.00%

Expected Cash-Flows

12.e Scoring ^Insights

12.f DCF ^BETA