Is the Flight Centre share price on a runway to growth in FY23?

An aeroplane at an airport taxiing down the runway symbolising the improving Flight Centre share priceAn aeroplane at an airport taxiing down the runway symbolising the improving Flight Centre share price

Shares in Flight Centre Travel Group Ltd (ASX: FLT) continued to wobble throughout FY22.

After hitting a 52-week low of $13.67 following the COVID-19 outbreak in Australia, the ASX travel share rebounded strongly.

In fact, its shares rocketed to a post-COVID high of $25.28 on 5 October.

However, this was short-lived as Flight Centre shares erased their strong gains to trade sideways for the remainder of FY22.

Nonetheless, we take a look at what some industry experts think the Flight Centre share price will do in FY23.

What’s in store for Flight Centre shares?

Turning to FY23, Goldman Sachs analysts believe the medium-term view will be largely unchanged for the Flight Centre share price.

The team acknowledged Flight Centre’s positive trading update in which the company reported “very strong activity levels in March 2022”.

However, external factors impacting the current economic climate, such as extreme inflationary movements, could hit the company’s earnings.

Higher airfares would likely drive potential holidaymakers away as the cost of living soars.

Furthermore, the emergence of new COVID-19 strains, increased competition in the corporate segment, and geopolitical tensions may disrupt operations and thus, potential revenue.

Goldman Sachs expects Flight Centre to report total EBITDA of $434.9 million, up 0.3% from previous forecasts.

As such, the broker maintained a neutral rating with a 12-month price target of $20.40 per share.

Based on Monday’s closing price of $17.37, this implies an upside of around 17.5% for investors.

The broker Macquarie has a similar view on Flight Centre shares. Its analysts raised their price target by 16% to $21.95 apiece.

Key upside risks include a faster-than-expected recovery as well as significant market-share gains in the online channel and travel bubble routes.

In the past 12 months, the Flight Centre share price has risen 16.9%, but is down 1.4% year-to-date.

The post Is the Flight Centre share price on a runway to growth in FY23? appeared first on The Motley Fool Australia.

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Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Goldman Sachs. The Motley Fool Australia has recommended Flight Centre Travel Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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