LATAM Airlines Group S.A (LTM.SN) fair value

ACCE thesis

LATAM Airlines operates a mainline and regional network across Chile, Peru, Colombia, Brazil and beyond, selling long-haul and domestic seats plus a loyalty program and cargo capacity. Its moat is scale in South America's Pacific and Atlantic corridors, where few carriers can match its route density and hub access in Santiago and Lima. Revenue grew 27.2% in the latest reported year, and the trailing P/E of 9.4 sits well below the forward P/E of 24.6, which signals that near-term earnings are expected to fall from elevated recent levels. A 5.3% operating margin against a 108.0% ROE shows how thin the operating base is and how much leverage sits behind the equity, so the return figure should be read with caution. The name is worth a deeper look mainly to test whether the revenue momentum converts into durable margins, since the earnings normalization implied by the forward multiple is the central question.