UBS has issued a research report indicating that BOC Aviation (02588) is benefiting from a reacceleration in asset growth and is entering a new upward cycle in return on equity (ROE). The bank forecasts that ROE will reach 11.7% in 2026 and 12.7% in 2027, up from 10.9% in 2025. It believes that as ROE improves, the company's valuation has room for a rerating. UBS slightly raised its profit estimate for BOC Aviation last year by 2%, but lowered its 2026 and 2027 profit forecasts by 2% to 4% to reflect higher interest rate assumptions. The bank increased its target price for the company from HK$86.5 to HK$96.9, maintaining a "Buy" rating. UBS expects BOC Aviation's profit for last year to reach approximately $720 million, with capital expenditure in line with the forecast guidance of $4 billion. Revenue growth from leasing operations is projected to accelerate from 1% year-on-year in the first half of last year to 5.5% in the second half. In terms of shareholder returns, the bank anticipates a full-year dividend of $0.36 per share, with a payout ratio of 35%. However, given the company's significant potential to optimize its capital structure, it cannot be ruled out that it may gradually adopt a more generous dividend policy.