Investment Research Analysis: Grupo Aeroportuario del Pacifico S.A.B. de CV (PAC)

The Gemini Report - Investment Deep Dives
The Gemini Report – Investment Deep Dives
Investment Research Analysis: Grupo Aeroportuario del Pacifico S.A.B. de CV (PAC)
Loading
/

Executive Summary

Grupo Aeroportuario del Pacifico, S.A.B. de C.V. (PAC) is a premier private airport operator in Latin America, managing a strategically diversified portfolio of 12 airports in Mexico and two in Jamaica. The company’s investment profile is defined by its advantageous position to capitalize on secular growth trends in Mexican tourism and international trade, particularly the “nearshoring” phenomenon. The core of the investment thesis rests on PAC’s ability to execute a substantial, multi-year capital investment program designed to significantly expand airport capacity, coupled with a sophisticated strategy to grow high-margin non-aeronautical revenues. This dual approach aims to enhance revenue per passenger and fortify the business model against economic cycles.

Key opportunities for the company are rooted in the robust recovery and continued growth of passenger traffic, supported by favorable government policies toward aviation infrastructure and strong tourism fundamentals. A well-defined pipeline of infrastructure projects, particularly at its key hubs, provides clear visibility into future capacity growth. Concurrently, the company is actively diversifying its revenue streams, reducing its reliance on regulated aeronautical fees and increasing its exposure to more lucrative commercial operations.

However, the investment case is not without significant risks. PAC operates within a highly regulated environment in Mexico, exposing it to potential changes in tariff-setting mechanisms that could impact profitability. The business is inherently sensitive to macroeconomic cycles, particularly in Mexico and the United States, its primary source market for international travelers. Furthermore, the successful execution of its ambitious capital expenditure plan is critical and carries inherent operational and financial risks. Currency volatility between the Mexican Peso and the U.S. Dollar also presents a material variable to financial performance.

From a valuation perspective, PAC’s shares are currently trading at multiples that reflect its high profitability, as evidenced by strong return on equity and industry-leading margins. The valuation narrative is a balance between these attractive financial metrics and the geopolitical and regulatory risks associated with its primary country of operation. This report will provide a detailed analysis of the factors that could justify a premium or discount to its peers and historical averages, offering a comprehensive framework for an informed investment decision.

1. Business Overview & Operations

Airport Portfolio and Geographic Footprint

Grupo Aeroportuario del Pacifico operates a well-diversified portfolio of 14 airports, 12 in Mexico and two in Jamaica, strategically positioned to capture a mix of business, leisure, and VFR (visiting friends and relatives) traffic.1 These assets can be categorized based on their primary traffic drivers:

  • Major Metropolitan & Business Hubs: Guadalajara (GDL) and Tijuana (TIJ) are the cornerstones of the portfolio, serving major metropolitan areas and functioning as critical business and logistics centers.3 Guadalajara, the company’s headquarters, is being strategically developed as “The Mexican Silicon Valley,” serving a vast catchment area of over 16 million people within a three-hour drive and benefiting from the nearshoring trend.5 The Tijuana airport possesses a unique and highly valuable asset in the Cross Border Xpress (CBX), a pedestrian bridge connecting the terminal directly to San Diego, USA. This facility effectively transforms TIJ into a binational airport, providing a strategic gateway to the Southern California market and classifying its users as international passengers.6
  • Premier Tourist Destinations: The airports at Los Cabos (SJD) and Puerto Vallarta (PVR) are world-renowned leisure destinations, capturing a significant share of high-value international tourism, predominantly from the United States and Canada.3 These airports are central to Mexico’s tourism industry and are key beneficiaries of strong consumer travel demand.
  • Growing Mid-Sized Cities: A cluster of airports, including Guanajuato (BJX), Hermosillo (HMO), Morelia (MLM), and Aguascalientes (AGU), serve developing economic regions across Mexico.3 These airports are positioned to benefit from domestic economic expansion, industrial growth, and the relocation of manufacturing and supply chains to Mexico.
  • International Diversification: Through its acquisitions of Sangster International Airport (MBJ) in Montego Bay and Norman Manley International Airport (KIN) in Kingston, PAC has established a significant presence in Jamaica.7 This provides valuable geographic diversification outside of Mexico and direct exposure to the resilient Caribbean tourism market.8

The mix of airport types within the portfolio creates a natural hedge. While premier tourist destinations are highly profitable, they can be susceptible to economic downturns that affect discretionary travel. In contrast, traffic at hubs like Guadalajara and Tijuana, which serve large VFR populations, tends to be more resilient during such periods, providing a stable foundation for passenger volumes.

Revenue Streams Breakdown

PAC’s revenue model is bifurcated into two principal streams, with a clear strategic emphasis on growing the higher-margin, unregulated segment.10

  • Aeronautical Revenues: These are regulated revenues derived from core aviation services. The primary component is the Passenger Usage Fee (TUA, or Tarifa de Uso de Aeropuerto), charged to all departing passengers. Other sources include aircraft landing and parking fees, and charges for the use of passenger jet bridges.10 These revenues are subject to a maximum rate cap established every five years by the Mexican government. In the first quarter (1Q25), aeronautical revenues demonstrated strong growth, increasing by 20.9% year-over-year to reach MX$6.0 billion.6
  • Non-Aeronautical Revenues: This segment encompasses all commercial activities within the airports and is not subject to rate regulation, offering higher growth and margin potential. Key sources include rental income from retail stores, food and beverage outlets, and car rental agencies; fees from parking lots and advertising; and revenue from VIP lounges.10 This segment is the central pillar of PAC’s growth strategy. In 1Q25, non-aeronautical revenues surged by an impressive 41.3% to MX$2.39 billion, highlighting the success of the company’s commercial initiatives.6 As a result, non-aeronautical activities contributed 29% of total revenues (excluding construction revenue) in 1Q25, a significant increase that underscores the ongoing diversification of the business model.5

Concession Terms and Management

PAC was incorporated in 1998 as part of a broader Mexican government initiative to privatize the nation’s airport system, aiming to attract private investment to improve quality, safety, and efficiency.2 The company operates its Mexican airports under 50-year concessions granted by the Ministry of Infrastructure, Communications, and Transport (SICT), which are set to expire in 2048. These long-term agreements provide a stable operating framework and a quasi-monopolistic position in their respective geographic regions. In return, PAC is obligated to make significant capital investments according to five-year Master Development Programs (MDPs) negotiated with the government. The Jamaican airports operate under similar long-term concession agreements.7

The company’s shares have been publicly traded on the New York Stock Exchange (NYSE: PAC) and the Mexican Stock Exchange (BMV: GAP B) since its IPO in February 2006.2 A strategic partner, Aeropuertos Mexicanos del Pacífico (AMP), holds a 15% stake in the company and maintains specific rights related to the appointment of key executives and the approval of strategic plans, including the MDPs.3 The board of directors, chaired by Laura Diez-Barroso Azcárraga, and the executive team, including Chief Financial Officer Saúl Villarreal García, are responsible for the company’s strategic direction and operational oversight.13

2. Industry Dynamics & Market Position

Mexican Aviation Industry Trends and Growth Drivers

The Mexican aviation industry is supported by powerful and durable tailwinds, positioning it for sustained long-term growth. The sector has demonstrated remarkable resilience, recovering strongly from the COVID-19 pandemic and benefiting from Mexico’s strategic geographic and economic position.

  • Favorable Growth Forecasts: Industry bodies and government agencies project a positive outlook. The International Air Transport Association (IATA) forecasts 5.8% growth in Revenue Passenger Kilometers (RPKs) for Latin America in 2025.14 Mexico’s Federal Civil Aviation Agency (AFAC) anticipates a more conservative but still robust annual passenger growth rate of 3% to 5% in the coming years.15 This growth is fundamentally driven by a rising middle class with increasing disposable income, enhanced air connectivity, and the expansion of low-cost carriers that make air travel more accessible.14
  • Robust Tourism Sector: Mexico stands as the premier tourist destination in Latin America, having welcomed 45 million international visitors in 2024, a new post-pandemic record.18 The latest data from Mexico’s Ministry of Tourism (SECTUR) for the period of January to October 2024 shows a 7.2% year-over-year increase in international tourist arrivals.19 The United States and Canada remain the dominant source markets, a trend that directly benefits PAC’s portfolio, which is heavily concentrated along Mexico’s Pacific coast and in key tourist hubs like Los Cabos and Puerto Vallarta.18
  • Supportive Regulatory Environment and Infrastructure Investment: The Mexican government has signaled strong support for the aviation sector through a landmark infrastructure investment plan. A total of MX134billionisslatedforairportmodernizationandexpansionbetween2025and2030.Whilethegovernmentwillcontributepublicfunds,thevastmajorityofthisinvestment—MX102.6 billion—is expected to come from private airport groups like PAC.15 This public-private partnership framework provides a clear runway for growth and capacity enhancement across the national airport system. While this investment is a strong positive, it also implies a heightened level of government expectation, which could translate into increased regulatory scrutiny and pressure on operators to meet stringent service and investment targets during future tariff negotiations.

Competitive Landscape

The privatized airport sector in Mexico operates as a functional oligopoly, dominated by three publicly traded groups, each with a distinct geographic and strategic focus. PAC, Grupo Aeroportuario del Sureste (ASUR), and Grupo Aeroportuario del Centro Norte (OMA) collectively handle the majority of passenger traffic outside of Mexico City.21

  • Grupo Aeroportuario del Sureste (ASUR): ASUR’s portfolio is anchored by Cancun International Airport (CUN), Mexico’s busiest airport for international passengers and the gateway to the Riviera Maya. This makes ASUR highly leveraged to international leisure and tourism trends.22 The company also has a significant international presence with operations in San Juan, Puerto Rico, and six airports in Colombia.22
  • Grupo Aeroportuario del Centro Norte (OMA): OMA’s key asset is Monterrey International Airport (MTY), a major industrial and business hub in northern Mexico. Its network is more heavily weighted towards domestic business and industrial-related travel, making its performance more closely correlated with the health of the Mexican domestic economy.22 OMA’s passenger base is 87% domestic.22
  • PAC’s Differentiated Position: PAC’s portfolio composition provides a more balanced and diversified exposure compared to its peers. The combination of major business hubs (GDL, TIJ), premier tourist destinations (SJD, PVR), and developing regional airports creates a superior risk-adjusted growth profile. This structure allows PAC to capture upside from multiple, less-correlated economic drivers: U.S. consumer spending on leisure travel, nearshoring-driven business activity, and resilient VFR traffic. This diversification was evident in 1Q25 results, where PAC delivered superior revenue and passenger growth while ASUR’s traffic in Mexico experienced a decline.11 Analyst commentary from institutions like BBVA has also favored PAC for its diversified portfolio and stronger earnings growth outlook for 2025.23

The following table provides a snapshot of the competitive landscape based on the most recent financial reporting period.

MetricGrupo Aeroportuario del Pacifico (PAC)Grupo Aeroportuario del Sureste (ASUR)Grupo Aeroportuario del Centro Norte (OMA)
Revenue Growth (1Q25 YoY)30.1%18.2%15.6%
Net Income Growth (1Q25 YoY)26.6%14.2%19.3%
Total Passenger Growth (1Q25 YoY)4.2% (Consolidated)0.2% (Consolidated)9.1%
Key Airport Driver(s)Guadalajara (Business), Los Cabos (Tourism), Tijuana (Cross-Border)Cancun (International Tourism)Monterrey (Domestic Business/Industrial)
Market Capitalization (July 2025)~$11.6 Billion 25~$9.2 Billion 26~$5.3 Billion 26
LTM EV/EBITDA~14.5x 25~10.0x (as of Dec 2023) 27~12.1x (LTM) 27
LTM P/E Ratio~26.6x 25~12.7x (Dec 2024) 28~19.9x 29

Note: Valuation multiples are based on the latest available data and may vary. ASUR and OMA multiples are from various sources and may reflect different time periods.

3. Financial Performance & Growth Analysis

Historical Financial Performance

Grupo Aeroportuario del Pacifico has a strong and consistent track record of delivering revenue growth and high levels of profitability. An analysis of its financial statements reveals a resilient business model that has successfully navigated economic cycles and external shocks, including the COVID-19 pandemic.

  • Revenue Trajectory: The company has demonstrated a robust long-term growth trend. Prior to the pandemic, from 2015 to 2019, total revenues grew at a compound annual growth rate (CAGR) of approximately 19%, driven by strong increases in both aeronautical and non-aeronautical streams.30 After the pandemic-induced dip in 2020, revenues recovered sharply, growing 45.2% in 2022 and 38.0% in 2023.31 For the full year 2024, annual revenue was $1.85 billion.31 The most recent quarterly results for 1Q25 showed total revenues increasing by 30.1% year-over-year, indicating continued momentum.6
  • Profitability and Margins: PAC operates with exceptionally high profitability margins, characteristic of a well-managed infrastructure asset with significant operating leverage. For the last twelve months (LTM), the company reported an EBITDA margin of 64.8% and an operating margin of 53.5%.25 Net profit margin stood at a healthy 25.6%.8 This high level of profitability translates into strong returns for shareholders, with LTM Return on Equity (ROE) at an impressive 37.7%.8 However, a notable trend in 1Q25 was a slight contraction in the EBITDA margin from 69.8% in 1Q24 to 67.1%.6 While revenues grew 30.1%, EBITDA grew by a slower 21.1%, suggesting that operating costs and concession fees are rising, a key trend to monitor as the company embarks on its large-scale investment program.

Passenger Traffic Analysis

Passenger traffic is the primary driver of PAC’s revenues, and its evolution reflects both macroeconomic trends and company-specific initiatives.

  • Post-Pandemic Recovery and Normalization: The company experienced a dramatic recovery in passenger volumes following the pandemic. Total terminal passengers grew from 30.3 million in 2015 to 48.7 million in 2019 before the downturn.30 In 2024, the company served 62.1 million passengers, a 2.2% increase from the prior year.5 Growth has since begun to normalize. For 1Q25, total passenger traffic across all 14 airports increased by 4.2% year-over-year to 16.3 million.5
  • Divergence in Traffic Drivers: A closer look at the 1Q25 traffic data reveals a significant shift in growth drivers. While major international tourist hubs like Puerto Vallarta (+0.4%) and Los Cabos (+0.3%) saw flat traffic, growth was propelled by domestic-focused airports and developing cities such as Los Mochis (+30.2%), Morelia (+18.8%), and the key business hub of Guadalajara (+8.8%).6 This divergence suggests that the initial post-pandemic “revenge travel” boom to premier destinations is maturing. The next phase of growth appears more reliant on the strength of the Mexican domestic economy, the expansion of secondary airports, and the development of new international routes to less-saturated markets.
  • Domestic vs. International Mix: This trend is further reflected in the split between domestic and international traffic. In 1Q25, domestic passenger traffic showed robust growth of 9.1%, while international traffic declined slightly by 0.7%.6 This underscores the increasing importance of domestic travel and VFR traffic as a stable and growing component of PAC’s passenger base.

Financial Health

PAC maintains a solid financial position, with manageable leverage and adequate liquidity to support its operations and ambitious investment plans.

  • Debt and Leverage: As of the most recent financial data, PAC’s debt-to-equity ratio stands at approximately 1.62, with a net debt-to-EBITDA ratio of around 2.6x.8 These leverage levels are considered prudent for a capital-intensive infrastructure company with predictable, long-term cash flows. The company has demonstrated successful access to capital markets, as seen with its recent Ps. 6.0 billion bond issuance in March 2025, which received the highest possible credit ratings in Mexico and was significantly oversubscribed.6
  • Liquidity Position: The company maintains a healthy liquidity profile. The current ratio was 1.68 as of the latest reports, indicating ample capacity to meet its short-term obligations.8 As of March 31, 2025, PAC held a strong cash and cash equivalents position of Ps. 16.2 billion.6

4. Capital Allocation & Investment Strategy

Master Development Program (2025-2029)

The centerpiece of PAC’s capital allocation strategy is its ambitious Master Development Program (MDP) for its Mexican airports, a five-year plan negotiated and approved by the Mexican government. This program represents a transformative investment cycle aimed at modernizing and significantly expanding the capacity of its key assets to meet projected long-term demand.

  • Committed Investment: For the 2025-2029 period, PAC has committed to a capital expenditure plan totaling MXP 43.2 billion (approximately $2.4 billion USD).5 This represents a substantial increase over previous investment cycles and underscores the company’s confidence in the long-term growth trajectory of Mexican aviation.
  • Strategic Allocation: The investments are strategically allocated to projects with the highest potential for return and impact on capacity. Terminal buildings are the largest recipient, accounting for 37% of the total budget, with a goal of adding over 50% more square meterage across the network. Airfield improvements (runways, aprons) will receive 18%, and equipment renovation 13%.5 The allocation by airport is heavily weighted towards the company’s most critical hubs: Guadalajara will receive 44% of the total investment, followed by Tijuana (18%) and Los Cabos (13%).5
  • Financing Strategy: This extensive program will be financed through a combination of internally generated cash flow and new debt issuances. The company’s strong balance sheet and high credit ratings provide it with favorable access to capital markets. The successful Ps. 6.0 billion bond issuance in March 2025 was explicitly intended to refinance existing debt and help fund these MDP commitments, demonstrating a proactive approach to managing its capital structure.6

Dividend Policy and Shareholder Returns

PAC has historically maintained a policy of returning a significant portion of its earnings to shareholders through dividends, balancing this with the capital requirements of its growth projects.

  • Dividend Payouts: Following its Annual General Shareholders’ Meeting on April 24, 2025, the company approved a total dividend of Ps. 16.84 per share, marking its 40th dividend payment.35 To manage cash flow, the payment is structured in two equal installments of Ps. 8.42 per share, with the first paid on May 28, 2025.35 This represents a substantial return of capital to shareholders and translates to a forward dividend yield in the range of 3.4% to 4.8%.8
  • Historical Context: The company has a long track record of dividend payments, though they were temporarily suspended in 2020 and 2021 in response to the uncertainty of the COVID-19 pandemic.13 Payments resumed robustly thereafter. The current payout ratio is notably high, which is a key factor for investors to monitor, especially in light of the significant capital demands of the new MDP.8 The company does not currently offer a dividend reinvestment program (DRIP) for shareholders.2

The concurrent pursuit of a large-scale investment program and a generous dividend policy creates a potential tension in capital allocation. While the company’s strong cash flow generation and access to debt markets currently support this dual strategy, investors must closely monitor leverage ratios and free cash flow generation. Any significant operational shortfall or tightening in credit markets could force management to prioritize one objective over the other, posing a risk to either the dividend’s sustainability or the timeline of the growth projects.

5. Growth Opportunities & Strategic Initiatives

Grupo Aeroportuario del Pacifico’s growth strategy is multi-faceted, extending beyond simple passenger volume increases to focus on enhancing profitability per passenger and developing new, high-margin revenue streams.

Organic Growth Through Capacity Expansion

The foundational element of PAC’s growth strategy is the organic expansion of its existing airport infrastructure. The 2025-2029 Master Development Program is the primary vehicle for this, with its MXP 43.2 billion investment aimed at decongesting current facilities and preparing for future traffic growth.5 By adding over 50% more terminal space and upgrading airfields at key airports like Guadalajara, Tijuana, and Los Cabos, the company is ensuring it can accommodate the rising demand from tourism and business travel without compromising service quality.5

Enhancing Non-Aeronautical Revenues

The most critical driver for future margin expansion and value creation lies in the strategic development of non-aeronautical revenues. This strategy moves PAC beyond the role of a simple infrastructure landlord to that of a sophisticated commercial operator.

  • Shift to Direct Operations: A key strategic pivot involves PAC taking direct control of commercial businesses within its airports, such as car parks, VIP lounges, and convenience stores, rather than leasing the space to third-party operators.10 While this model increases operational complexity, it allows PAC to capture the full retail margin instead of just a fraction through rent. The success of this initiative is evident in the data: directly operated businesses accounted for 43% of non-aeronautical revenues in 1Q25, a significant increase from 30% in the same period of 2024.5
  • Airport-Adjacent Real Estate Development: PAC is pioneering the concept of the “airport city” in Mexico, transforming its landholdings into integrated commercial destinations. The flagship example is the new Mixed-Use Building at Guadalajara Airport. This development includes a 180-room Hilton Garden Inn hotel, which opened in March 2024, as well as office buildings and additional commercial areas slated for completion in 2024 and 2025.5 This initiative creates entirely new, diversified revenue streams and leverages the airport’s role as a major transit and business hub.
  • Focus on Guadalajara as a “Nearshoring” Hub: The heavy concentration of capital investment (44% of the MDP) in Guadalajara is a deliberate strategic bet on the “nearshoring” trend.5 By branding the hub as “The Mexican Silicon Valley,” PAC aims to attract high-yield business travel associated with the technology, logistics, and advanced manufacturing sectors relocating to Mexico. Success in this area would provide a powerful counterbalance to the more cyclical leisure tourism that drives traffic at its coastal airports.

Network and Route Expansion

PAC works proactively with airline partners to expand its route network, which is a direct driver of passenger traffic. In 1Q25 alone, the company’s airports added 13 new routes, including 10 international and 3 domestic destinations.5 For the full year, the company plans to introduce a total of 34 new routes (19 international and 15 domestic), further strengthening connectivity and enhancing the competitive positioning of its airports.39

6. Risk Assessment

An investment in Grupo Aeroportuario del Pacifico carries a distinct set of risks inherent to its business model, geographic focus, and regulatory framework. These must be carefully considered alongside the company’s growth opportunities.

Regulatory and Political Risks

This represents the most significant and least predictable category of risk for PAC.

  • Tariff Regulation and Concession Terms: The company’s aeronautical revenues, a substantial portion of its total income, are subject to a price-cap regulation system based on five-year Master Development Programs (MDPs). The upcoming tariff review for the 2025-2029 period in Mexico introduces new complexities, including changes to the discount rate formula used in calculations and a “clawback clause” that allows the government to reclaim a portion of revenues if passenger traffic significantly exceeds projections.5 Any unfavorable changes to this regulatory framework, whether through lower approved tariffs or more restrictive terms, could materially and adversely affect the company’s profitability and return on invested capital.
  • Political and Governmental Risk: As a concessionaire of public infrastructure in Mexico and Jamaica, PAC is exposed to political risk. Changes in government, shifts in public policy, or social instability could lead to renegotiation of concession agreements, imposition of new taxes or fees, or other adverse actions that could impact the business.22

Economic Sensitivity and Currency Exposure

PAC’s performance is highly correlated with broader economic conditions.

  • Macroeconomic Cycles: Demand for air travel, for both leisure and business, is highly cyclical and dependent on economic growth and consumer confidence. A recession in the United States, which is the primary source of Mexico’s international tourists, or a significant slowdown in the Mexican domestic economy would lead to reduced passenger traffic and lower commercial spending at PAC’s airports.39
  • Currency Fluctuation: The company’s financials are exposed to fluctuations in the Mexican Peso (MXN) to U.S. Dollar (USD) exchange rate. A significant portion of its revenues, particularly from international passengers and certain commercial contracts, is denominated in or linked to the USD. Conversely, a large share of its operating expenses, such as labor and local services, are in MXN. While a weaker peso can provide a translational boost to reported revenues, a sharp and sustained appreciation of the peso could compress operating margins.

Operational and Execution Risks

  • Capital Expenditure Execution Risk: The company is undertaking a massive, multi-billion dollar capital investment program. This large-scale plan carries significant execution risk, including the potential for construction delays, cost overruns, and disruptions to existing airport operations, all of which could negatively impact projected financial returns.
  • Dependence on Key Tourism Markets: Despite efforts to diversify, PAC’s financial performance remains heavily influenced by its key tourist airports, particularly Los Cabos and Puerto Vallarta. These destinations are susceptible to shifts in travel trends, security concerns, or natural disasters such as hurricanes, which could disproportionately impact the company’s results.18
  • Force Majeure Events: The global aviation industry is vulnerable to unforeseen external shocks. The COVID-19 pandemic served as a stark reminder of this risk, but other events such as terrorist attacks, geopolitical conflicts, or widespread health crises could severely disrupt air travel and have a profound negative impact on operations.40

7. Valuation Analysis

The valuation of Grupo Aeroportuario del Pacifico reflects a balance between its high-quality infrastructure assets, strong profitability, and clear growth runway against the notable regulatory and macroeconomic risks associated with its operating jurisdictions.

Current Trading Multiples

  • Price-to-Earnings (P/E) Ratio: As of mid-2025, PAC trades at a trailing twelve-month (TTM) P/E ratio in the range of 24.0x to 26.6x.8 This is elevated compared to its peer, OMA (~19.9x), but reflects PAC’s larger scale and more diversified revenue base. Historically, PAC’s P/E has been volatile, peaking during periods of uncertainty (like the pandemic recovery) and troughing during stable periods. The current multiple is above its 5-year average, suggesting the market is pricing in future growth.42
  • Enterprise Value to EBITDA (EV/EBITDA) Ratio: The company’s TTM EV/EBITDA multiple is in the range of 10.9x to 14.5x.25 This is a key metric for capital-intensive businesses like airport operators. Historically, this multiple has seen a wide range, peaking above 22.0x in 2020 and falling to a low of 10.0x in 2023.27 The current level appears moderate within this historical context and is comparable to or slightly higher than its Mexican peers.27 Global airport M&A transactions for high-growth assets have often occurred at significantly higher multiples, in the range of 18x to 24x, though these are for control transactions rather than public market valuations.45

Comparable Company Analysis

When compared to its domestic peers, PAC’s valuation carries a premium. With a market capitalization of approximately $11.6 billion, it is significantly larger than ASUR (~$9.2 billion) and OMA (~$5.3 billion).25 This premium can be justified by PAC’s superior revenue growth in recent quarters, its more diversified asset portfolio which provides greater resilience, and its aggressive and well-defined strategy for growing high-margin non-aeronautical revenues. However, some analysis suggests that OMA, being earlier in its growth and investment cycle and having lower leverage, could offer higher potential upside, whereas PAC and ASUR may represent more stable, mature growth stories.47

Discounted Cash Flow (DCF) Considerations

A DCF valuation is highly sensitive to its underlying assumptions, but it provides a useful framework for assessing intrinsic value. The key value drivers for a PAC DCF model are:

  1. Passenger Traffic Growth: The long-term rate of growth in both domestic and international passengers.
  2. Revenue Per Passenger: The ability to increase both regulated aeronautical tariffs and, more importantly, unregulated non-aeronautical spending.
  3. Capital Expenditures: The magnitude and timing of the MXP 43.2 billion MDP, which will be a significant drain on free cash flow in the medium term before generating returns.
  4. Discount Rate: The cost of equity is a critical input. Analyst models have used rates around 16%, reflecting the perceived risk of operating in Mexico, which includes a country risk premium.48
  5. Terminal Growth Rate: Often linked to the long-term risk-free rate of the country, such as the 10-year government bond yield, which has been estimated around 8.4%.48

Third-party DCF analyses based on these types of assumptions have produced a wide range of valuations, with some suggesting the stock is trading near fair value while others indicate significant undervaluation.48 This highlights the dependency on long-term growth and risk assumptions.

Dividend Yield Analysis

With a forward dividend yield of approximately 3.4% to 4.8%, PAC offers an attractive income component for an infrastructure asset.8 This yield provides a degree of valuation support. However, the sustainability of the dividend must be continually assessed in the context of the company’s substantial capital expenditure commitments. A high payout ratio combined with a large investment program could strain the balance sheet if operating cash flows underperform expectations.

In summary, the investment debate centers on whether PAC’s premium valuation is justified by its superior operational metrics and growth strategy. A bullish perspective would argue that the market is appropriately pricing in the long-term cash flow generation from its capacity expansions and successful non-aeronautical pivot. A more cautious or bearish view would contend that the current multiples do not fully account for the significant regulatory risks in Mexico or the potential for a macroeconomic downturn to impact travel demand.

8. Key Metrics to Monitor

To effectively track the performance and risk profile of Grupo Aeroportuario del Pacifico, investors should focus on a core set of operational and financial metrics. These indicators provide timely insight into the health of the business and the execution of its strategic plan.

Operational Metrics

  • Monthly Passenger Traffic Reports: PAC provides detailed monthly traffic statistics, which are a primary leading indicator of revenue performance. Key items to monitor include:
  • Year-over-year growth in total passenger traffic for the consolidated group.
  • Breakdown of traffic growth by key airports (Guadalajara, Tijuana, Los Cabos, Puerto Vallarta) to assess the performance of different business segments.
  • The mix between domestic and international passenger growth, which can signal shifts in economic drivers.
  • Revenue per Passenger (Total, Aeronautical, and Non-Aeronautical): This is a crucial metric for evaluating the company’s monetization strategy. A rising non-aeronautical revenue per passenger is a direct indicator of the success of its commercial initiatives.
  • Load Factors: Reported by the company, this metric reflects airline capacity utilization and the overall health of demand on routes serving PAC’s airports.

Financial and Efficiency Metrics

  • EBITDA and EBITDA Margin: Tracking the absolute growth in EBITDA and, critically, the EBITDA margin (excluding IFRIC-12 construction effects) is essential for monitoring profitability and operational efficiency, especially in light of rising costs.
  • Capital Expenditure (CapEx) Deployment: Investors should compare quarterly CapEx figures against the company’s guidance and the five-year MDP budget to track the progress and discipline of the investment program.
  • Return on Invested Capital (ROIC): This is the ultimate measure of value creation. A stable or rising ROIC indicates that the company’s substantial capital investments are generating returns that exceed its cost of capital.
  • Leverage and Coverage Ratios:
  • Net Debt-to-EBITDA: This ratio should be monitored to ensure leverage remains within a manageable range (typically below 3.0x-3.5x for stable infrastructure assets) as the company takes on debt to fund its MDP.
  • Interest Coverage Ratio: This measures the ability to service debt payments from operating profit.

External and Strategic Factors

  • Regulatory Updates: Any announcements from the Mexican Ministry of Infrastructure, Communications, and Transport (SICT) regarding the 2025-2029 MDP framework, tariff calculations, or other changes to the concession agreements.
  • Macroeconomic Indicators: Key data points from Mexico and the United States, including GDP growth, consumer confidence surveys, and the MXN/USD exchange rate.
  • Airline Route Announcements: New route additions or capacity increases by major airline partners are positive indicators of future traffic growth.

Works cited

  1. Grupo Aeroportuario del Pacífico (GAPB) Investor Relations Material – Quartr, accessed July 21, 2025, https://quartr.com/companies/grupo-aeroportuario-del-pac-fico-s-a-b-de-c-v_14465
  2. Investors – Grupo Aeroportuario del Pacífico, accessed July 21, 2025, https://aeropuertosgap.com.mx/en/investors/36-inversionistas.html
  3. About us – Grupo Aeroportuario del Pacífico, accessed July 21, 2025, https://www.aeropuertosgap.com.mx/en/about-us.html
  4. Contributing to the takeoff of aviation in Mexico – Grupo Aeroportuario del Pacífico, accessed July 21, 2025, https://www.aeropuertosgap.com.mx/GAP/
  5. Grupo Aeroportuario del Pacifico Q1 2025 slides: Revenue surges 26% amid expansion, accessed July 21, 2025, https://www.investing.com/news/company-news/grupo-aeroportuario-del-pacifico-q1-2025-slides-revenue-surges-26-amid-expansion-93CH-4123214
  6. Grupo Aeroportuario Del Pacifico Announces … – GlobeNewswire, accessed July 21, 2025, https://www.globenewswire.com/news-release/2025/04/29/3069808/0/en/Grupo-Aeroportuario-Del-Pacifico-Announces-Results-for-the-First-Quarter-of-2025.html
  7. Grupo Aeroportuario del Pacífico Files Annual Report for Fiscal Year 2024 – Nasdaq, accessed July 21, 2025, https://www.nasdaq.com/articles/grupo-aeroportuario-del-pacifico-files-annual-report-fiscal-year-2024
  8. Grupo Aeroportuario Del Pacifico (PAC) Expected to Announce Quarterly Earnings on Monday – MarketBeat, accessed July 21, 2025, https://www.marketbeat.com/instant-alerts/grupo-aeroportuario-del-pacifico-pac-expected-to-announce-quarterly-earnings-on-monday-2025-07-21/
  9. Grupo Aeroportuario Del Pacifico, SAB de CV Grupo Aeroportuario Del Pacifico, SA de CV (each representing 10 Series B shares) (PAC) – Nasdaq, accessed July 21, 2025, https://www.nasdaq.com/market-activity/stocks/pac
  10. GAPB Investor Relations – Grupo Aeroportuario del Pacifico SAB de CV – Alpha Spread, accessed July 21, 2025, https://www.alphaspread.com/security/bmv/gapb/investor-relations
  11. Mexico’s Airports See 1Q25 Revenue Rise Despite Traffic Shifts, accessed July 21, 2025, https://mexicobusiness.news/aerospace/news/mexicos-airports-see-1q25-revenue-rise-despite-traffic-shifts
  12. ¿Quiénes somos? – Grupo Aeroportuario del Pacífico, accessed July 21, 2025, https://www.aeropuertosgap.com.mx/es/2012-03-02-17-22-49.html
  13. pac-20f_20211231.htm – SEC.gov, accessed July 21, 2025, https://www.sec.gov/Archives/edgar/data/1347557/000156459022015156/pac-20f_20211231.htm
  14. Latin America’s Aviation to Grow 5.8% in 2025, IATA Reports – Mexico Business News, accessed July 21, 2025, https://mexicobusiness.news/aerospace/news/latin-americas-aviation-grow-58-2025-iata-reports
  15. IATA Sees LatAm Recovery as Mexico Targets 4% Growth, accessed July 21, 2025, https://mexicobusiness.news/aerospace/news/iata-sees-latam-recovery-mexico-targets-4-growth
  16. Mexican Airlines See 3.7% YoY Passenger Growth in 2025 – AeroLatinNews, accessed July 21, 2025, https://aerolatinnews.com/aviation-industry/mexican-airlines-see-3-7-yoy-passenger-growth-in-2025/
  17. Latin America Aviation Industry Trends and Forecast 2025-2034 – GlobeNewswire, accessed July 21, 2025, https://www.globenewswire.com/news-release/2025/06/25/3105061/0/en/Latin-America-Aviation-Industry-Trends-and-Forecast-2025-2034-Low-Cost-Carriers-Transform-Latin-America-s-Aviation-Landscape.html
  18. Tourism In Mexico Statistics 2025: All You Need To Know – GoWithGuide, accessed July 21, 2025, https://gowithguide.com/blog/tourism-in-mexico-statistics-2025-all-you-need-to-know-5248
  19. tourism – DataTur, accessed July 21, 2025, https://datatur.sectur.gob.mx/RAT/RAT-2024-10(EN).pdf
  20. Octubre turismo en cifras (Inglés) – Datatur, accessed July 21, 2025, https://www.datatur.sectur.gob.mx/RAT/RAT-2024-10(EN).pdf
  21. Airports – Proyectos México, accessed July 21, 2025, https://www.proyectosmexico.gob.mx/en/how-mexican-infrastructure/investment-cycle/airports/
  22. Mexican Airports. An investment memo – Jenga Investment Partners, accessed July 21, 2025, https://jengaip.com/mexican-airports-a-short-investment-memo/
  23. Asur – BBVA Market Strategy, accessed July 21, 2025, https://www.bbvamarketstrategy.com/companies/asur/
  24. Airports – BBVA Market Strategy, accessed July 21, 2025, https://www.bbvamarketstrategy.com/tag/airports/
  25. Grupo Aeroportuario del Pacífico (PAC) Statistics & Valuation – Stock Analysis, accessed July 21, 2025, https://stockanalysis.com/stocks/pac/statistics/
  26. Grupo Aeroportuario del Sureste (ASR) – Market capitalization – Companies Market Cap, accessed July 21, 2025, https://companiesmarketcap.com/asur/marketcap/
  27. Grupo Aeroportuario del Pacífico, S.A.B. de C.V. (BVMF:P2CF34) EV / EBITDA, accessed July 21, 2025, https://www.investing.com/pro/BVMF:P2CF34/explorer/ev_to_ebitda_ltm
  28. Grupo Aeroportuario del Pacifico | GAPB – PE Price to Earnings – Trading Economics, accessed July 21, 2025, https://tradingeconomics.com/gapb:mm:pe
  29. Grupo Aeroportuario del Pacifico PE Ratio Analysis – YCharts, accessed July 21, 2025, https://ycharts.com/companies/PAC/pe_ratio
  30. pac-20f_20191231.htm – SEC.gov, accessed July 21, 2025, https://www.sec.gov/Archives/edgar/data/1347557/000156459020027372/pac-20f_20191231.htm
  31. Grupo Aeroportuario Del Pacifico, S.A De C.V Revenue 2010-2025 | PAC – Macrotrends, accessed July 21, 2025, https://www.macrotrends.net/stocks/charts/PAC/grupo-aeroportuario-del-pacifico,-sa-de-cv/revenue
  32. Grupo Aeroportuario del Pacífico, S.A.B. de C.V. Price: Quote, Forecast, Charts & News (GPAEF) – Perplexity, accessed July 21, 2025, https://www.perplexity.ai/finance/GPAEF/financials
  33. Grupo Aeroportuario Del Pacifico Announces Results for the First Quarter of 2025, accessed July 21, 2025, https://www.morningstar.com/news/globe-newswire/9440754/grupo-aeroportuario-del-pacifico-announces-results-for-the-first-quarter-of-2025
  34. Grupo Aeroportuario del Pacífico Successfully Issues Ps. 6 Billion in Long-Term Bond Certificates | Nasdaq, accessed July 21, 2025, https://www.nasdaq.com/articles/grupo-aeroportuario-del-pacifico-successfully-issues-ps-6-billion-long-term-bond
  35. Grupo Aeroportuario del Pacífico Announces Dividend Payment Schedule for 2025, accessed July 21, 2025, https://www.nasdaq.com/articles/grupo-aeroportuario-del-pacifico-announces-dividend-payment-schedule-2025
  36. Grupo Aeroportuario del Pacifico Announces 8.42 Peso Dividend Payment | PAC Stock News, accessed July 21, 2025, https://www.stocktitan.net/news/PAC/grupo-aeroportuario-del-pacifico-announces-payment-date-for-the-7g9n10y8lo4v.html
  37. Grupo Aeroportuario Pacifico Stock Price Today | NYSE: PAC Live – Investing.com, accessed July 21, 2025, https://www.investing.com/equities/grupo-aeroportuario-del-pacifico
  38. Grupo Aeroportuario del Pacífico (PAC) – Dividends – Companies Market Cap, accessed July 21, 2025, https://companiesmarketcap.com/grupo-aeroportuario-del-pacifico/dividends/
  39. Earnings call transcript: Grupo Aeroportuario del Pacifico Q1 2023 sees solid growth, accessed July 21, 2025, https://www.investing.com/news/transcripts/earnings-call-transcript-grupo-aeroportuario-del-pacifico-q1-2023-sees-solid-growth-93CH-4014148
  40. Grupo Aeroportuario del Pacífico – Wikipedia, accessed July 21, 2025, https://en.wikipedia.org/wiki/Grupo_Aeroportuario_del_Pac%C3%ADfico
  41. Grupo Aeroportuario Del Pacifico, S.A De C.V PE Ratio 2010-2025 | PAC – Macrotrends, accessed July 21, 2025, https://www.macrotrends.net/stocks/charts/PAC/grupo-aeroportuario-del-pacifico,-sa-de-cv/pe-ratio
  42. Gap PE ratio, current and historical analysis – FullRatio, accessed July 21, 2025, https://fullratio.com/stocks/nyse-gap/pe-ratio
  43. PAC Fundamental Valuation Multiples (Grupo Aeroportuario Del…) – Market Chameleon, accessed July 21, 2025, https://marketchameleon.com/Overview/PAC/Fundamentals-Valuation-Multiples/
  44. Grupo Aeroportuario del Pacífico (PAC) Financial Ratios – Stock Analysis, accessed July 21, 2025, https://stockanalysis.com/stocks/pac/financials/ratios/
  45. Airport valuations have taken off – the question is where will they land? – PwC UK, accessed July 21, 2025, https://www.pwc.co.uk/transport-logistics/assets/airport-valuations-february-2019.pdf
  46. The Latest Trends in Airport M&A Activity – ALG: Global, accessed July 21, 2025, https://www.alg-global.com/blog/aviation/latest-trends-airport-ma-activity
  47. OMAB stock price analysis – higher upside potential than PAC or ASR – Sven Carlin, accessed July 21, 2025, https://svencarlin.com/omab-stock-price-analysis/
  48. Estimating The Fair Value Of Grupo Aeroportuario del Pacífico, S.A.B. de C.V. (BMV:GAPB), accessed July 21, 2025, https://www.webull.com/news/13170206410318848
  49. Estimating The Fair Value Of Grupo Aeroportuario del Pacífico, S.A.B. de C.V. (BMV:GAPB), accessed July 21, 2025, https://simplywall.st/stocks/mx/transportation/bmv-gap-b/grupo-aeroportuario-del-pacifico-de-shares/news/estimating-the-fair-value-of-grupo-aeroportuario-del-pacfico
  50. Grupo Aeroportuario del Pacífico, SAB de CV Nathan’s Discounted Free Cash Flow, accessed July 21, 2025, https://discountingcashflows.com/company/PAC/valuation/repository/nathan-winklepleck-cfa/nathans-discounted-free-cash-flow/