To The Moon

$SIA(C6L.SI)$ Singapore Airlines (SIA) is facing a real test of investor confidence after tumbling for three straight days. The headline numbers are jarring: a 59% plunge in net income, dragged down by Air India-related losses and shrinking interest income, despite revenue ticking up thanks to record travel demand and resilient cargo volumes. It’s a classic example of how even industry leaders can get blindsided by one-off losses and cost pressures—reminding everyone that the airline business is never as simple as “more passengers = more profit.”

How do you view the profit decline? The sharp drop is concerning, but not catastrophic. SIA’s core operations still look solid, with top-line revenue up and travel demand holding firm. The Air India losses are disappointing, but they’re also partly transitional and could ease as integration headaches subside. What’s more worrying is the lower interest income, which could signal a tougher macro environment ahead—especially if rates start to fall and cash reserves earn less.

With the stock in a short-term free fall, the market is clearly resetting expectations. For buy-the-dip investors, the key is to focus on levels where SIA’s core valuation, dividend yield, and long-term outlook become too attractive to ignore. Historically, SIA has found support near S$5.00–S$5.20, with stronger hands stepping in when the yield creeps higher and pessimism peaks. If the broader market remains shaky or SIA guides cautiously next quarter, a retest of these levels isn’t out of the question—and that’s where I’d start getting interested.

Ultimately, the profit slump stings, but it doesn’t erase SIA’s status as a best-in-class carrier with deep pockets and strong brand loyalty. For patient investors, buying into sharp weakness—especially if the dip overshoots on negative headlines—has historically paid off. As always, don’t rush: let the dust settle, watch for stabilization, and target that S$5.00–S$5.20 range for a lower-risk entry.