What Is Flight Centre Travel Group Limited’s (ASX:FLT) Share Price Doing?
Flight Centre Travel Group Limited (ASX:FLT), a hospitality company based in Australia, saw a double-digit share price rise of over 10% in the past couple of months on the ASX. As a mid-cap stock with high coverage by analysts, you could assume any recent changes in the company’s outlook is already priced into the stock. However, could the stock still be trading at a relatively cheap price? Today I will analyse the most recent data on Flight Centre Travel Group’s outlook and valuation to see if the opportunity still exists. See our latest analysis for Flight Centre Travel Group
What is Flight Centre Travel Group worth?
According to my valuation model, Flight Centre Travel Group seems to be fairly priced at around 10% above my intrinsic value, which means if you buy Flight Centre Travel Group today, you’d be paying a relatively reasonable price for it. And if you believe the company’s true value is A$50.91, there’s only an insignificant downside when the price falls to its real value. In addition to this, it seems like Flight Centre Travel Group’s share price is quite stable, which could mean there may be less chances to buy low in the future now that it’s fairly valued. This is because the stock is less volatile than the wider market given its low beta.
What kind of growth will Flight Centre Travel Group generate?
Future outlook is an important aspect when you’re looking at buying a stock, especially if you are an investor looking for growth in your portfolio. Buying a great company with a robust outlook at a cheap price is always a good investment, so let’s also take a look at the company’s future expectations. Flight Centre Travel Group’s earnings over the next few years are expected to increase by 31.18%, indicating a highly optimistic future ahead. This should lead to more robust cash flows, feeding into a higher share value.
What this means for you:
Are you a shareholder? FLT’s optimistic future growth appears to have been factored into the current share price, with shares trading around its fair value. However, there are also other important factors which we haven’t considered today, such as the track record of its management team. Have these factors changed since the last time you looked at the stock? Will you have enough confidence to invest in the company should the price drop below its fair value?
Are you a potential investor? If you’ve been keeping an eye on FLT, now may not be the most optimal time to buy, given it is trading around its fair value. However, the optimistic prospect is encouraging for the company, which means it’s worth diving deeper into other factors such as the strength of its balance sheet, in order to take advantage of the next price drop.
Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on Flight Centre Travel Group. You can find everything you need to know about Flight Centre Travel Group in the latest infographic research report. If you are no longer interested in Flight Centre Travel Group, you can use our free platform to see my list of over 50 other stocks with a high growth potential.
To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned.
