How Expensive is Cebu Air, Inc. (CEB) fundamentally? 3rd Quarter Update

Cebu Air, Inc. (CEB), which is an airline company that operates under the trade name "Cebu Pacific Air," was incorporated on August 26, 1988. The Company was granted a 40-year legislative franchise to operate international and domestic air transport services in 1991. CEB commenced its scheduled passenger operations in 1996 with its first domestic flight from Manila to Cebu. International operations began in 2001 with flights from Manila to Hong Kong.

CEB pioneered the "low fare, great value" strategy in the local aviation industry. In 2005, the Company adopted the low-cost carrier (LCC) business model, whose strategy is to offer affordable air service to passengers.

On March 20, 2014, CEB acquired 100% ownership of Tiger Airways Philippines, including a 40% stake in Roar Aviation II Pte. Ltd., a wholly-owned subsidiary of Tiger Airways Holdings Limited.

CEB currently operates a fleet of 55 aircraft which comprises of eight Airbus A319, 33 Airbus A320, eight ATR 72-500, and six Airbus A330 aircrafts. It operates its Airbus aircraft on both domestic and international routes.

As of December 31, 2015, the Group operates an extensive route network serving 56 domestic routes and 41 international routes with a total of 2,685 scheduled weekly flights. It operates from
seven hubs located in Pasay City, Metro Manila; Lapu-Lapu City, Cebu; Clark, Pampanga; Davao City, Davao del Sur; Ilo-ilo City, regional center of western Visayas region; and Kalibo, Aklan.

As of December 13, 2016, CEB was last traded price at PHP 90.00. This is only 1.77 higher compare to their recorded book value as according to their September 2016 financial report. I guess it's not yet expensive since, for most value investor a PBV of more than 3 is already considered expensive.

In terms of P/E, the company recorded a trailing P/E of 12.43 meaning, for every 1PHP earning last 2015, investors of this company are willing or is paying 12.43Php to which is not expensive yet. With a P/E of 12.43 and a growth rate of 413.48% since EPS increases from 1.41 to 7.24 from 2014 to 2015 respectively, the company trailing PEG ratio would only be 0.03, this is way less than one therefore, not expensive. 

In terms of income, the first 9 months net income attributable to parents this year increases by 99.60% in comparison to last year first 9 months net income.

With the company current market price, the company seems to be sound fundamentally.

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