FLT - Flight Centre Travel Group

[frugal.rock]

In a more psitive note,
I hear lost baggage claims are down *99.25%....


(*random source)

 

[galumay]

Galumay Flight Centre will survive no doubt and if it was just a matter of Covid I would say its a buy as some of their smaller competitors going out of business will increase their market share in the brick and mortar travel space.

Yep, as you say its a structurally challenged business model, I had a very quick look at it and WEB but I would rather have my capital in better quality businesses. There is probably some short term opportunity for the more speculative types in these sort of businesses, if you do your research and pick the right entry they probably will have a rerate at some point.

I think you have to be very careful though, I didn't go in very deep with FLT, but looking at WEB, once you allow for the dilution, price is only off about 30% from highs - thats still very expensive for a mothballed business!

 

[fergee]

Yep, as you say its a structurally challenged business model, I had a very quick look at it and WEB but I would rather have my capital in better quality businesses. There is probably some short term opportunity for the more speculative types in these sort of businesses, if you do your research and pick the right entry they probably will have a rerate at some point.

I think you have to be very careful though, I didn't go in very deep with FLT, but looking at WEB, once you allow for the dilution, price is only off about 30% from highs - thats still very expensive for a mothballed business!

Im with you @galumay wouldn't be too keen to play the travel rebound through WEB or FLT, would prefer to get in via the airports currently. AIA etc

 

[finicky]

Sealinks's recovered well so far (SLK)

 

[Value Hunter]

I agree that airport stocks such as Auckland Airport or Sydney Airport are the preffered plays in the travel space but the prices of those two socks are still too high for my liking.

 

[fergee]

I agree that airport stocks such as Auckland Airport or Sydney Airport are the preffered plays in the travel space but the prices of those two socks are still too high for my liking.

AIA > SYD. SYD has a huge amount of debt and possible competition from a new Sydney airport that's being planned.
Agreed AIA is a bit pricey right now but bought on a correction and added to on the the dips for a 3-5 year holding period should be long enough to see the dividends reinstated and a good increase in share price, there is good value to be had in there imo.

 

[bigdog]

The company’s corporate segment is recovering at a more rapid pace than the leisure sector. This is due to customers meeting the ‘essential services’ criteria, which are related to mining/resources, health/pharma and government industries.

The company announced it will shut down another 91 stores across Australia. This brings a total of 408 stores closed since the pandemic began, leaving 332 stores to face an uncertain future!

The travel agency is cashed up but still faces a high cash-burn rate in a zero-revenue environment.

Also flights in and out Australia are getting closer!

 

[bigdog]

Flight Centre Travel News announced today

Western Australia is opening on November 14th to Queensland, the Northern Territory, South Australia and Tasmania (pending case numbers).

Tasmania already opened up borders to South Australia, Western Australia, the Northern Territory, Queensland and the ACT on Monday. Opening up to New South Wales on November 6th ?

Whilst Victorian's are still on step three restrictions, they were able to 'get on the beers' as restrictions eased on Wednesday night. Though we know Dan Andrews will be going a little higher up on the shelf today, celebrating his first day off after 120 days straight. Onya Dan!

Queensland opens to New South Wales on November 3rd, although unlucky Sydneysiders are the exception to this. Stay tuned friends ?

We're still eagerly waiting to hear back from Jacinda about visiting our mates across the ditch.

 

[galumay]

Too hard for me.

 

[bigdog]

NSW-Victoria border reopens.

Flight Centre Travel Group Ltd (ASX: FLT) and Webjet Limited (ASX: WEB) shares could be on the rise today after the NSW government announced the opening of its border with Victoria today after being closed for 137 days. This is expected to lead to hundreds of flights between Melbourne and Sydney from this week.


FLT is my top for November

 

[samuilk]

might get some FLT soon - surely price would reach pre crash levels after international travel announced ...

 

[galumay]

You might want to check out the dilution & debt, the business is not the same as pre covid. There are nearly twice as many shares on issue for starters, plus a lot more debt. I guess it depends how many punters look no further than comparing the share price now and the pre covid share price, given the current market and the flood of inexperienced capital, its quite possible it reaches pre cash levels - as irrational as that would be.

 

[samuilk]

You might want to check out the dilution & debt, the business is not the same as pre covid. There are nearly twice as many shares on issue for starters, plus a lot more debt. I guess it depends how many punters look no further than comparing the share price now and the pre covid share price, given the current market and the flood of inexperienced capital, its quite possible it reaches pre cash levels - as irrational as that would be.

Good point, will do further research into this one.

 

[Dona Ferentes]

The Covid challenge continues. Must be hard being an intermediary in an industry with so much small print. The evolution of ticketing restrictions to offer the lowest price (race to the bottom) didn't anticipate a pandemic and global disruption.

I just received full refund for tix to Canada. Once the inevitability that travel wouldn't happen for a while sunk in, and extensions were up against consumer law, then the fix fell into place.

Bit of a process, airline notifies refund can happen, FC contact customer, I confirm, they send agreement to airline which releases funds to FC, contact me for details. I fill in and get the $$s. But it happened quickly and efficiently when it had to.

 

[Sean K]

Some interesting discussion here regarding travel related stocks and what happened after Covid really hit and buy opportunities / future of the companies. The rest of the World seems to have opened / be opening up while we remain in locked up down under land. It's gotta end at some stage and FLT and WEB move back to pre Covid prices at some point. 2-5 year investment?

 

[waterbottle]

Possibly, but that's a gamble on the world returning to what it was like in 2019.
It may, but I think it will be a bumpy ride as governments will try to wrestle rising case loads with stretched public hospitals and the need to curb movement to some degree.

 

[qldfrog]

Possibly, but that's a gamble on the world returning to what it was like in 2019.
It may, but I think it will be a bumpy ride as governments will try to wrestle rising case loads with stretched public hospitals and the need to curb movement to some degree.

The Reset wants to suppress air travel for the commoners..we will see the effect within 10y imho
carbon tax,flight miles tax, maybe using covid again as a pretext.
Short term play on rebound only

 

[Sean K]

Interesting. I'm going to take a bet that we keep flying as a necessity. I think businesses are still going to have to do face to face and I don't think we're going to zoom our holidays just yet. I reckon a lot of people have travel plans on pause and once they get a green light, it will be off to the races.

 

[Dona Ferentes]

In the middle of the second and third round of lockdowns across Australia and some of its global markets, Flight Centre has decided that that is a good time to invest in a new business, with potential. Flight Centre expand its corporate travel footprint in Asia by launching a Japanese joint venture next January.

The company told the ASX that it plans to launch its leading FCM travel management business in Japan, the world’s fourth-largest corporate travel market, via a joint venture with Tokyo-based NSF Engagement Corporation.

Flight Centre CEO Graham Turner said Japan was a significant addition to the global FCM network, which now extended to 97 countries through company-owned businesses and licensing agreements with independent local operators.

“Japan is a key corporate market because of its size and importance within the global economy as a business hub for multi-national companies,” Mr Turner told the ASX on Thursday.

“By securing an equity position in this crucial market, we will enhance our ability to win new local, regional and multi-national accounts, while also gaining greater control over and enhancing the service we provide to our existing customers with operations in Japan.”

Mr Turner said he anticipated FCM would become a very significant business and a valuable addition to the company’s Asian network, which also includes businesses in China including SAR Hong Kong, India Singapore and Malaysia.

There seems to be no concerns that the Covid driven lockdowns and working from home trend will restrict this new business. Japanese office workers and corporate executives have not gone home to the same degrees as those in Australia, NZ, the US and much if Europe.

 

[Dona Ferentes]

Flight Centre says its business travel customers now book their trips just under eight days prior to travel, compared with 16.7 days pre-pandemic.

The average business trip has reduced by 1.5 days from 5.8 days to 4.4 days.

“Our customers have also relied more on booking with a person (in addition to our online services) for peace of mind, the latest information and expertise,” GM James Kavanagh said.