New Morningstar Analyst Report for Aéroports de Paris

Aeroports de Paris owns and operates airports in the number-one tourist destination in the world: Paris. The Charles de Gaulle and Orly airports account for nearly 100% of traffic in the Paris area. We estimate that ADP handles a bit more than 50% of passenger traffic in all of France. However, the company is unable to reap the benefits of its geographic monopoly, as its regulator targets a mid-single-digit return on capital as appropriate for regulated services (more than half of last year's revenue). While we expect profitability to improve as the company increases its retail and real estate sales, we don't think ADP has carved an economic moat.