With such strong EPS growth, this stock deserves to trade at a high multiple. The market P/E/is 25, this is 21. Granted, it is only a mid-cap. The key to its earnings growth is its EBIT expansion. Look at fuel prices, they have doubled over the past year. CGO does not pay fuel costs, it is paid by customers. This is the greatest expense in the air business. This should trade at higher than average multiples in this high fuel cost environment. Not to mention the increasing top-line from Asian traffic. It is at least a hold as it continue to outperform its industry index.
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