SINGAPORE (March 18): UOB Kay Hian is rating Singapore Airlines a “buy” with $13.90 target price, given its stronger passenger load factors.

“In an environment of weak jobs growth and soft global economy outlook, Singapore Airlines' strong traffic numbers highlight a willingness to travel for both the full-service and low-cost segments,” says UOB.

Stronger passenger loads, more fuel-efficient aircraft and low fuel prices should lower the risk profile of the group.

The carrier's passenger load factor jumped by 2.2 percentage points to 78.3% in February over the last year as traffic grew faster than capacity.

Loads across all regions were higher, but Europe rose the strongest, at 4.3 percentage points, as SIA seeks to fight back competition from Middle Eastern airlines.

SIA shares closed 0.5% higher at $11.51 on Friday.