The Sydney Airport Holdings Pty Ltd (ASX:SYD) share price is trading lower after the release of its August traffic update…
The post Sydney Airport (ASX:SYD) share price lower on traffic update: Is it time to buy? appeared first on Motley Fool Australia. –
The Sydney Airport Holdings Pty Ltd (ASX: SYD) share price is edging lower on Friday after the release of its latest traffic figures.
In morning trade the airport operator’s shares are down 0.5% to $5.49.
What did Sydney Airport announce?
It was another difficult month for Sydney Airport in August.
During the month, Australia’s largest airport welcomed just 129,000 passengers through its terminals. This was a reduction of 96.5% on the prior corresponding period.
It was also down notably month on month from 317,000 passengers during July.
A total of 39,000 international passengers passed through Sydney Airport in August, down 97.2% on the prior corresponding period. This was broadly in line with July’s figures.
Also falling sharply was its domestic passenger numbers, which were down 96.1% on the prior corresponding period to 91,000. This compares to 276,000 passengers in July.
Unfortunately, with border restrictions still largely in place around the country, management isn’t expecting a swift recovery in traffic.
It commented: “We expect the downturn in passenger traffic to persist until government travel restrictions are eased.”
Should you invest?
While times are hard now for Sydney Airport, a return to form will inevitably come in time.
So with the company’s liquidity looking more than sufficient to ride out the storm following its capital raising, I think it could be a good option for patient investors.
I’m not the only one that sees Sydney Airport as a buy. A note out of Morgans last month reveals that its analysts have an add rating and $6.56 price target.
This price target implies potential upside of 18% for its shares over the next 12 months excluding dividends. Though, I wouldn’t hold your breath on dividends being paid in the near term.
I suspect they will be suspended until trading conditions return to normal, which could be FY 2022.
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