Analyst Note
| Adam Fleck, CFA |Ongoing border closures continue to limit international passenger traffic at both wide-moat Auckland and narrow-moat Sydney Airports. But there is room for optimism, with renewed domestic tourism, local travel bubbles, and vaccines on the horizon. Encouragingly, Auckland Airport’s management noted at its annual meeting that higher domestic travel, and associated business such as car parking, has driven greater first-quarter fiscal 2021 profitability than anticipated. While the timing of border openings remains uncertain, the recent passenger trajectory tracks our near-term forecasts, and we maintain our fair value estimates: AUD 6.20 for Sydney, and NZD 6.50 (AUD 6.00) for Auckland.