The Flight Centre Travel Group Ltd (ASX: FLT) share price is on fire right now. Shares in the Aussie travel agency have soared 18% higher in the 8 trading days since Monday 20 September.
Flight Centre is up again today and trading at $21.25 shortly after open, which is 0.14% higher than yesterday’s close.
So, with Australia’s two most populous states still hampered by COVID-19 restrictions, how can this ASX travel share be charging higher?
How the Flight Centre share price has soared 18% higher in 8 days
One important factor to remember is that the share market is inherently forward-looking. The March bear market saw many ASX travel shares including Flight Centre get smashed even before earnings were directly affected.
The key, however, is that investors knew future earnings would be impacted. Shareholders are interested in future cash flows, which ultimately drives what a company’s intrinsic value is.
It may seem shocking that an ASX travel share can be outperforming while domestic and international borders remain shut. However, that’s exactly what we’re seeing with the Flight Centre share price right now.
There have been no updates from the Aussie travel group since 20 September, and even longer since any price-sensitive announcements. That hasn’t stopped investors from looking to the future and betting on Flight Centre’s success.
The important news in recent days has been around the reopening of the economy. New South Wales is gearing up to begin easing lockdown restrictions from what looks to be 11 October.
There is also a roadmap out of lockdown that includes talk of international border openings, while hopes remain for an easing of interstate restrictions by Christmas.
All of this is good news for the Flight Centre share price. Investors have been buying up big and pushing the ASX travel share up 18% in the past 8 days.
The post The Flight Centre (ASX:FLT) share price is up 18% in 8 days. How is this possible? appeared first on The Motley Fool Australia.
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Motley Fool contributor Ken Hall 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 Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
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