Why PAC's 40th Consecutive Dividend Payment Signals a Golden Opportunity

Grupo Aeroportuario del Pacífico (PAC) has just announced its 40th consecutive dividend payment, marking a milestone in its 25-year history of financial discipline and shareholder returns. With a 7.5% dividend increase in 2025 to MXN 16.84 per share, PAC’s track record of biannual payouts and cash flow resilience positions it as a top-tier income stock. This analysis explores why PAC’s dividend sustainability, coupled with growth catalysts in Mexico and Jamaica, makes it a compelling defensive play for income investors.

Dividend Sustainability: A 40-Year Proven Track Record

PAC has distributed dividends for 40 consecutive years, a feat unmatched in the global airport sector. The 2025 dividend represents a 7.5% increase over 2024’s MXN 15.70 per share, continuing its tradition of annual hikes. Even during the pandemic, PAC prioritized payouts by drawing from retained earnings, avoiding debt-fueled distributions.

The dividend’s current yield of ~4% (based on a stock price of MXN 420) offers stability amid market volatility. With MXN 18.9 billion in retained earnings (as of April 2025), PAC has ample capital to sustain payouts through 2025 and beyond.

Operational Resilience: Cash Flow From Airport Concessions

PAC’s revenue model is inherently defensive. Its 12 Mexican airports and two Jamaican airports operate under long-term concessions (until 2048 in Mexico), guaranteeing steady cash flows from aeronautical fees, retail rents, and parking. Even during the pandemic, cash flows remained resilient at 50% of revenues, covering operational costs without diluting equity.

Jamaica’s airports—Sangster International (Montego Bay) and Norman Manley (Kingston)—are growth engines. Post-pandemic, Jamaican tourism rebounded strongly, with passenger traffic up 35% YoY in Q1 2025. PAC’s $213 million investment in expanding these airports will boost capacity and profitability, driving future dividend growth.

Growth Catalysts: Mexico’s Domestic Travel Boom and Infrastructure Upgrades

Mexico’s domestic air travel market is booming, with traffic up 22% YoY in Q1 2025, outpacing international recovery. PAC’s focus on high-growth destinations like Puerto Vallarta, Los Cabos, and Guadalajara aligns with this trend. Meanwhile, $1 billion in CAPEX through 2025—funded by retained earnings—will modernize terminals, add runways, and improve operational efficiency, further boosting revenue.

The Master Development Plan includes a second runway at Guadalajara, critical for handling its 15 million annual passengers. These upgrades reduce congestion and attract airlines, creating a virtuous cycle of traffic growth and higher fees.

Why PAC Is a Defensive Income Play

• Low Debt Risk: PAC’s debt-to-EBITDA ratio remains below 2.5x, well within its target range. Rising interest costs are manageable due to strong cash flows.
• Geopolitical Stability: Mexico’s tourism recovery and U.S.-Mexico trade ties reduce dependency on volatile international markets.
• Yield Stability: Even in a 2025 recession scenario, PAC’s MXN 16.84 dividend is secured by concession cash flows. A 4% yield at current prices provides a safe harbor in turbulent markets.

The Case for Share Price Appreciation

PAC’s stock trades at a discount to its 2019 pre-pandemic high, offering upside as traffic recovers. Analysts project a 100% stock price increase by 2026 if traffic returns to 2019 levels, aligning with PAC’s $64.85 present value calculation (discounted at 8%).

Final Analysis: Act Now to Lock in Dividends and Growth

PAC’s 40th dividend payment is more than a milestone—it’s proof of its ability to thrive in any economic climate. With Mexico’s domestic air travel penetration rising, Jamaica’s tourism boom, and disciplined CAPEX execution, PAC is primed for sustained dividend growth.

Investors should act immediately:
- Buy PAC at current prices to capture the 4% yield and participate in future dividend hikes.
- Hold for the long term to benefit from 7–8% annual returns via dividends and share price appreciation.

PAC isn’t just an airport operator—it’s a dividend powerhouse with a fortress balance sheet and secular growth tailwinds. This is your chance to own a piece of Mexico’s travel renaissance while earning reliable income. Don’t miss it.

Disclosure: This analysis is for informational purposes only. Investors should conduct their own research and consult financial advisors before making decisions.