2025 Aviation Stocks Investment Guide: In-Depth Analysis and Stock Selection Tips for Taiwan and U.S. Quality Airlines

What Are Airline Stocks? Essential Knowledge Before Investing

Airline stocks refer to shares of publicly listed airline companies, which investors can buy directly through stock codes. These stocks can be categorized into two main types based on corporate nature:

State-Owned Airlines: Controlled directly or indirectly by the government, with stable internal management structures and relatively manageable operational risks. These companies are suitable for conservative investors seeking stable returns. Taiwan’s EVA Air belongs to this category. In the Hong Kong market, China Eastern Airlines and China Southern Airlines are typical representatives.

Private Airlines: Led by private capital, with frequently changing ownership structures. US airlines like Southwest and United, as well as Chinese carriers Spring Airlines, Juneyao Airlines, and Huaxia Airlines, fall into this camp. Compared to state-owned companies, private airlines are more flexible in operations but also experience higher volatility and risks.

Core Drivers of Airline Stock Fluctuations

The performance of airline stocks is closely linked to various economic variables, making understanding these factors crucial for investment decisions.

Global Economic Cycles: During economic expansion, disposable income increases, travel spending rises, and demand for air travel surges. Conversely, during recessions, travel contracts, putting pressure on airline stocks. The COVID-19 pandemic is an extreme example—global economic shocks led to a collapse in air travel demand.

Oil Price Fluctuations and Cost Transmission: Fuel costs constitute a significant portion of airline expenses. Rising oil prices increase operating costs, prompting airlines to raise ticket prices, which may reduce passenger volume. Falling oil prices provide relief, allowing lower fares to stimulate demand and improve profit margins.

Interest Rate Environment and Financing Costs: The airline industry is capital-intensive, requiring substantial financing for fleet upgrades and infrastructure. Rising interest rates increase borrowing costs, hindering capital expenditure plans; low rates encourage expansion.

These factors interact, making profitability challenging for the airline industry. Continuous cost optimization and revenue innovation are necessary to maintain competitiveness.

US Airline Stocks Investment Opportunities Analysis

Delta Air Lines (DAL): A Stable Choice Among US Airlines

Delta is one of the four major US airlines, headquartered in Atlanta, Georgia. Founded in 1924, it has established a global network covering over 1,000 destinations across six continents. The company has advantages in business travel and international routes, and controls costs through owning refineries and other measures.

As of the latest data, Delta’s stock price on November 13, 2025, is $60.48, with a market capitalization of $39.49 billion. It has gained approximately 69.51% this year but has pulled back 3.86% in the past month. Recent trends show increased volatility, suitable for investors who can tolerate larger fluctuations. Morgan Stanley lists it as the top US airline pick, citing its premium customer base and fuel hedging advantages.

Key Indicators:

• Stock Price: $60.48
• Market Cap: $39.49 billion
• P/E Ratio: 8.52
• Recent Month Change: -3.86%

Copa Airlines (CPA): Growth Potential as a Latin American Hub

Copa is the largest airline group in Latin America, comprising Copa Airlines and AeroRepública. Based in Panama City, it operates an average of 327 flights daily, serving 78 destinations across 32 countries, benefiting from rising disposable incomes and urbanization in Latin America.

In the first half of 2025, it posted excellent financial results, with a net profit of $149 million in Q2, up 25% YoY, and earnings per share of $3.61. Cash and investments totaled $1.4 billion at the end of the period. Operational metrics are also strong: 91.5% on-time rate, 99.8% flight completion rate, and a 4.6% YoY decrease in unit costs. It has been recognized as Central America’s best airline for ten consecutive years by Skytrax.

Stock Performance:

• Market Cap: $523 million
• P/E Ratio: 8.27
• Recent Month Gain: 4.28%

Ryanair (RYAAY): Europe’s Low-Cost Carrier Expansion Engine

Ryanair is the world’s largest low-cost airline group, headquartered in Ireland. Since its founding in 1985, it has become known for ultra-low fares and efficient operations. It currently operates 640 aircraft, with 3,600 flights daily, serving 207 million passengers annually. The company has ordered 300 new Boeing 737s, planning to increase annual passenger volume to 300 million by 2034.

As of November 13, the stock price is $64.61, with a market cap of $34.317 billion. For the 2025 winter season, it added three Milan-based aircraft, investing $3.1 billion, opening five new routes, and increasing 40 popular routes, with an expected annual passenger volume of 19 million.

Investment Data:

• Stock Price: $64.61
• Market Cap: $34.317 billion
• P/E Ratio: 12.72
• Recent Month Gain: 43.91%

Investment Value of Taiwanese Airline Stocks

EVA Air (2618): Benchmark of Quality in Taiwan’s Aviation Industry

EVA Air is a top-tier Taiwanese airline, established in 1989, with Skytrax five-star certification. Its fleet includes Boeing 787 and Airbus A350 aircraft, serving over 60 international cities across Asia, Europe, North America, and Oceania. The company also operates cargo services, with plans to upgrade 777 passenger aircraft to freighters in 2025, ensuring diversified revenue streams.

In Q3, passenger load factor reached 92.5%, domestic routes increased to 93.5%, and international capacity grew 28% YoY. As of November 13, its stock price is NT$37.2, with a market cap of NT$186 billion. Analysts estimate a full-year target price of NT$37.84. The company continues to expand popular routes (e.g., Kaohsiung-Osaka), with new aircraft deployed to Brisbane, Vancouver, and other destinations.

Taiwan Stock Data:

• Stock Code: 2618
• Price: NT$37.2
• Market Cap: NT$18.956 billion
• P/E Ratio: 6.56
• Recent Month Change: -2.2%

China Airlines (2610): Multi-Brand Strategy for Comprehensive Coverage

China Airlines, founded in 1959, is Taiwan’s oldest airline, a member of the SkyTeam alliance. It owns subsidiaries China Trust Airlines and Tigerair Taiwan, forming a full-service plus low-cost market coverage. The fleet includes 83 aircraft (65 passenger, 18 cargo), operating over 1,400 flights weekly.

In Q3, passenger load factor was 86.9%, up 4.4 percentage points from pre-pandemic levels. International capacity increased 13% YoY, with high bookings on Northeast Asia and North America routes. As of November 13, its stock price is NT$28.6, with a market cap of NT$162 billion. The market expects long-haul route expansion to bring valuation recovery.

Taiwan Stock Performance:

• Stock Code: 2610
• Price: NT$28.6
• Market Cap: NT$15.985 billion
• P/E Ratio: 7.63
• Recent Month Change: -0.6%

Starlux Airlines (2646): Growth Stock with New Full-Service Airline Traits

Starlux is a new Taiwanese full-service airline, rapidly expanding routes in Asia and North America since 2020. With rising tourism demand and urbanization in Asia, its market potential is significant.

In Q3, passenger load factor was 85.9%, with international capacity up 10% YoY. The Taipei-California Ontario route launched in June has 80% bookings. The company ordered 10 Airbus A350-1000s at the Paris Air Show, planning to deploy them to Phoenix and other new destinations. In April, it added Taichung-Kobe route to strengthen Northeast Asian presence. As of November 13, its stock price is NT$42.8, with a market cap exceeding NT$95 billion, up about 18% from the start of the year.

Growth Data:

• Stock Code: 2646
• Price: NT$42.8
• Market Cap: NT$7.071 billion
• P/E Ratio: 48.53
• Recent Month Change: -1.05%

Practical Methods for Investing in Airline Stocks

Via Traditional Brokers: Open an account with a securities firm and enter the stock code to place an order. Taiwanese airline stocks are traded directly through domestic brokers. US and Hong Kong stocks can be traded via cross-border entrustment or foreign brokers.

CFD Trading: Compared to traditional stocks, CFDs have no commission, allow two-way trading, and offer flexible leverage. Suitable for high-risk-tolerance short-term investors, provided risk management is in place to enhance capital efficiency.

Pros and Cons of Investing in Airline Stocks

Investment Advantages

High Cyclical Sensitivity: When travel demand rebounds, airline profits surge. From 2022 to 2024, many airlines saw significant profit growth, making them beneficiaries of economic recovery.

Market Barriers: Routes, traffic rights, and fleet quality are difficult to replicate quickly. Major airlines hold natural advantages in their home markets. The US Big Four dominate domestic hubs, maintaining long-term dominance.

Diversified Revenue Streams: Modern airlines earn not only from ticket sales but also from baggage fees, seat upgrades, mileage programs, cargo, and co-branded credit cards, maintaining profitability even in off-peak seasons.

Dividend Appeal: Well-funded airlines (e.g., Southwest, some European and Asian carriers) pay dividends during stable periods, attracting cash-flow-focused investors.

Investment Risks

High Cost Rigidity: Fuel, labor, and maintenance are major cost components. Rising oil prices or labor shortages directly impact earnings; during downturns, reduced travel worsens the situation.

High Debt Levels: Fleet and airport costs lead to high debt ratios. During economic downturns or rising interest rates, financial pressure increases. During the pandemic, many US airlines had to raise capital, diluting stock value.

Black Swan Vulnerability: External shocks like pandemics, geopolitical crises, weather events, and airspace restrictions are unpredictable but often cause flight reductions and passenger declines, leading to volatile stock prices.

Outlook for Airline Stocks in 2025 and Beyond

Industry Fundamentals Are Improving

After losing $140 billion during the pandemic, the airline industry returned to profitability in 2023. According to IATA, global passenger numbers are expected to surpass pre-pandemic levels by 2025, reaching over 800 million by 2040—doubling from pre-pandemic 4 billion, with an annual growth rate of 3.4%.

Veteran investors like Warren Buffett have shifted their stance, building large positions in Delta, American Airlines, and United. Wall Street firms like Morgan Stanley recommend airline stocks, upgrading American Airlines to overweight with a projected upside of over 35%.

Stock Selection and Timing Tips

Capitalize on Cycles: Airline stocks are classic cyclical stocks, following boom-bust patterns. The best entry points are near the end of a cycle, when recovery is confirmed but valuations are not yet fully reflected.

Regional Diversification: Spreading investments across different regions can effectively reduce single-market risks. Combining Taiwan, US, and European airline stocks enables a global portfolio.

Focus on Cash Flow: Prioritize airlines with strong cash flow, as they are better equipped to weather downturns. Long-term monitoring of cash reserves and operating cash flow helps avoid high leverage risks.

Airline stocks currently show a clear upward cycle, but investors must understand their cyclical nature and risks. Using diversified portfolios, timing entries, and managing risks can help balance returns and safety.