Top broker upgrades Flight Centre share price

A smiling travel agent sitting at her desk working for Corporate Travel ManagementA smiling travel agent sitting at her desk working for Corporate Travel Management

The Flight Centre Travel Group Ltd (ASX: FLT) share price has received a broker upgrade.

Flight Centre shares are rising 1.09% today and are currently priced at $20.38. For perspective, the S&P/ASX 200 Index (ASX: XJO) is up 0.2% today.

Let’s take a look at what is going on with the Flight Centre share price.

What’s the outlook?

JP Morgan has placed an “overweight” price target on Flight Centre shares of $22.60, The Australian reported. This implies an upside of about 11% based on the company’s current share price.

Flight Centre was among the top ten most shorted shares on the ASX yesterday.

Flight Centre delivered $95 million in underlying earnings before interest, tax, depreciation and amortisation (EBITDA) in the first half of FY23, ahead of its target of between $70 and $90 million

The result was a $280 million turnaround from the company’s loss in the first half of FY22. Total transaction volume (TTV) soared 203% to $9.9 billion.

The company is forecasting an underlying EBITDA of between $250 and $280 million in FY23.

Looking to the future, the company said in its FY23 half-year presentation:

While costs will increase as the post-COVID recovery continues, FLT expects to be able to service pre-COVID levels of TTV and revenue with a significantly lower cost base after making structural changes to increase productivity, increase scalability & rapidly grow labour-light leisure models during the pandemic

Flight Centre does not currently pay a dividend, although some analysts are tipping it could start paying out by the 2024 financial year.

Data released by Flight Centre recently shows Australia, the United Kingdom, the United States, Indonesia and Fiji, New Zealand, Thailand, Singapore, Italy and the Philippines were the top 10 popular destinations for Australian family travellers in the last year.

Last week, Flight Centre revealed during a Sydney presentation online bookings are growing three times faster than in-store clients. One-quarter of the company’s sales are now conducted online, compared to 15% before COVID-19. Females are spending 31% more than men in store, the data reported by Traveltalk shows.

Flight Centre share price snapshot

Flight Centre shares have shed 11.35% in the last year.

This ASX 200 travel share has a market cap of about $4.44 billion based on the latest share price.

The post Top broker upgrades Flight Centre share price appeared first on The Motley Fool Australia.

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More reading

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

from The Motley Fool Australia

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