Research · Sep 3, 2026
[LTM] LATAM Airlines Thesis 2026: Latin America Capacity Cycle Drives Post-Chapter 11 ROIC Recovery
LATAM Airlines Group S.A. (NYSE: LTM) FY2025 revenue ~$13.4-14.0B (+5-10%) with adj. EPS ~$1.55-1.85 reflecting continued post-2024 ~155-165B ASKs (Available Seat Kilometers) aggregate annual capacity (~+8-12% YoY) + selected continued post-November 2022 Chapter 11 emergence operating leverage + selected continued post-2024 ~$11-12B aggregate Passenger revenue (~80%+ aggregate revenue mix; selected primary Latin America domestic + selected various US-Latin America international + selected various Europe-Latin America international) + selected continued post-2024 ~$2.0-2.2B aggregate Cargo revenue (~15% aggregate revenue mix; selected primary Latin America cargo) + selected post-July 2024 NYSE re-listing IPO under continued President + CEO Roberto Alvo since April 2020 (~5-year tenure as LATAM Airlines CEO). The largest Latin America airline group. Founded 1929 as LAN Airlines in Santiago Chile (~96-year heritage); selected post-2007 NYSE LAN Airlines listing; selected post-June 2012 ~$3.4B aggregate LAN Airlines + TAM Airlines merger creating LATAM Airlines Group; selected post-March 2020 LATAM Chapter 11 filing; selected post-November 2022 LATAM Chapter 11 emergence; selected post-April 2020 Roberto Alvo CEO appointment; selected post-July 2024 NYSE re-listing IPO. Headquartered in Santiago Chile; ~37,000+ employees globally with ~$13.4-14.0B revenue. Two primary business segments: Passenger (~80%+ ~$11-12B), Cargo (~15% ~$2.0-2.2B). Geographic + traffic mix: Latin America domestic ~50%+ + US-Latin America international ~25%+ + Europe-Latin America international ~15%+ + Asia + selected various ~10%. Latin America capacity cycle: ~155-165B ASKs aggregate annual capacity; ~80%+ aggregate Latin America passenger market share leadership across Chile + Brazil + Peru + Colombia + Ecuador. Post-Chapter 11 emergence + ROIC recovery: post-November 2022 Chapter 11 emergence; post-July 2024 NYSE re-listing IPO; ROIC ~9-11% trajectory toward ~12-15%. President + CEO Roberto Alvo since April 2020 (~5-year tenure); CFO Ramiro Alfonsin. Capital + cash position: ~$3.0-3.5B aggregate cash + investments balance; net leverage ratio ~1.5-2.0x; selected pathway to dividend initiation FY2026-2027; investment-grade pathway B1/B+ credit rating. FY2026 thesis: Latin America capacity cycle + Post-November 2022 Chapter 11 emergence operating leverage + ROIC recovery + selected post-July 2024 NYSE re-listing IPO + ~$3.0-3.5B aggregate cash + investments balance + selected post-2024 ~1.5-2.0x net leverage + selected pathway to dividend initiation FY2026-2027. Risks: Latin America macro + GDP cycle, GOL + Azul + Avianca + Volaris competition, CLP + BRL + COP + ARS volatility, jet fuel pricing, post-November 2022 Chapter 11 emergence considerations.