LATAM Airlines Post-Earnings: Buyback Steady as Stock Drifts Lower

LATAM Airlines Group has just reported Q3 results, and the story has shifted decisively from the borrow-market drama of the past two weeks toward a quieter question: what happens to the stock now that the event has passed and the shorts have partially stood down.

The share price tells a subdued post-earnings story. LTM closed at CLP 21.69 on November 3, down 1.4% on the day and off nearly 2% for the week, extending a one-month decline of roughly 8%. That compares unfavourably with several correlated peers: UAL added 2.4% over the week, CPA gained 3%, and Air France-KLM rose close to 5%. SkyWest, which fell 19% over the same period, is the notable exception. For now, LTM is tracking closer to the laggards than to the recovery in US and European names.

The positioning picture has changed materially from the extremes described in pre-earnings notes. Availability, which collapsed to 2.1% at the close of October 29 (the tightest reading of the past year), had recovered to 29.6% by November 2 as short interest dropped 8.2% in a single session. The lending market has normalised from its most charged state, though short interest remains meaningfully higher than it was a month ago. The borrow cost and availability data in the current snapshot are too stale to update precisely, but the directional shift from the prior notes remains intact: conditions are looser, not tighter.

The most consistent feature of the recent activity record is the company's own share buyback programme. LATAM itself has been the dominant buyer in the register, repurchasing shares on consecutive trading days through late September at prices between CLP 24.19 and CLP 25.41, absorbing over 1.8 billion shares in the trades logged. Those purchases were made at prices roughly 15% above where the stock trades today, which gives the buyback a different complexion post-earnings. The company has net-acquired around 3.75 billion shares over the past 90 days at a combined value equivalent to roughly CLP 92 billion. Whether the programme continues at the same pace now that the stock has moved lower will be a practical test of conviction.

Ownership is concentrated and strategically held. Lauca Investments holds 13.2% of shares. Delta Air Lines and Qatar Airways each hold just above 10.5%, neither of which has changed its position in the most recent reporting period. BlackRock added approximately 888 million shares as of September 30, while Ninety One UK and two Chilean fund managers also added material positions in Q3. The register reflects a mix of strategic holders with long holding periods and active managers who have been building. That base limits the float available for short sellers, which partly explains why the borrow market was able to tighten as sharply as it did in October.

The factor scores add nuance. The utilisation rank sits in the 89th percentile and the short score rank in the 83rd, both reflecting the elevated positioning of the past month rather than any new signal. The earnings yield ranks in the 83rd percentile, which is the more forward-looking read given the Q3 print just landed. The EV/EBITDA multiple has drifted lower over the past 30 days, consistent with the price decline. Analyst data in the snapshot is stale and should not be quoted as current.

What to watch next is whether the buyback programme re-engages at current prices below CLP 22, and whether short interest continues its post-earnings decline or stabilises at a level that keeps borrow conditions tighter than they were before October.