Cathay Pacific up 6.2% as it seeks to cut costs

Hong Kong

CATHAY Pacific Airways Ltd is winning back stock investors as the carrier seeks to slash costs after its worst loss in more than 20 years. The shares have jumped 6.2 per cent this week, the best performance on Hong Kong's Hang Seng Index, which is little changed. The stock rallied after Goldman Sachs put Cathay Pacific on its conviction list, calling the company unloved and misunderstood. Investors are underestimating the airline's potential to boost earnings, Goldman analysts led by Ben Hartwright wrote in a note, citing improving demand and supply.

The shares have staged a steady recovery this year as the Hong Kong-based carrier looks at ways to cut costs, including pilot compensation. BLOOMBERG