FLT - Flight Centre Travel Group

[ROE]

Re: FLT - Flight Centre

RainMaker2000 are you still hold on this stock? Personally I think FLT is a great stock .. you see it just in about every place you go in Australia with people queuing up for service

But I'm uncomfortable with the current price, maybe when it get cheaper I come back in

 

[Rainmaker2000]

Re: FLT - Flight Centre

Yeah, I'm still holding but I understand the view that its overvalued, after all, its only a just over a year ago the thing was trading under $10....I took a few shares at 18$ off the table just before the big profit result....bad timing..hehehe......I don't think its overvalued for what it is..its an iconic brand...a cashflow machine....a business run by the same people who founded it and released it at 95 cents just a decadish ago.......its on a forward P/E of about 18 and there look like significant industry headwinds.......plus there are a few growth X factors at play I think.........1)I think MFS with its purchase of Harvey World Travel and everything else has consolidated the industry and at the same time created a weak competitor for FLT (2) I think FLT management is getting better at what they do and are bored with mediocrity......they are exploring a few more diverse growth avenues and 'startups' which I'm a massive fan off......what I hate is companies making big acquisitions and issuing shares.......these guys are the opposite....they are happy to use cash and debt to start small and establish potential goldmines.......Check out the latest analyst presentation when they talk about a) dominating business travel as well b) buying and selling commercial real estate c)using their business model for alternative retail......its possible that their growth is only just beginning and shareholders can benefit from their silky skills knowing that any startup loses will be absorbed almost without a hitch by the FLT machine

 

[Rainmaker2000]

Re: FLT - Flight Centre

ROE, do you still own some of these puppies..hehe...looks like the market is giving another chance to buy on a slight decline........I was planning to sell most holdings at round $30 but then the US acquisition came............I must say it is one of the most incredible acquisitions I've ever seen and shows how bloody astute these guys are.......1) They bought a private company still run by mom and pop 2)The company is effectively an uncanny clone of FLT, with it being the largest wholly owned 'bricks and mortar' travel agent in US but only the 10th largest agent in US 3) They paid an incredibly cheap price 6.6 Ebita 4) This company and its brand looks like it pioneered the leisure industry, FLT now get to rebrand all its US loss making stores Liberty 5) Liberty is an offline provider so they have not even started to leverage the brand on the internet which FLT has much expertise with by successfully transition from bricks and mortar to internet in Australia.

It's an incredible buy and means that realistically FLT should be valued at far more than 20 times earnings for this year. I've had to rethink my equity rebalancing as this baby is worth a lot more than its current price still!

 

[ROE]

Re: FLT - Flight Centre

Rainmaker I'm not touching FLT at this price I think the share price move way ahead of itself, plus FLT ROE has been diminishing from the early years so they get bigger but they don't offer the same Return on equity.. Their ROE number still good just not at the current share price

 

[Rainmaker2000]

Re: FLT - Flight Centre

I understand your viewpoint...it certainly is not the same company as the early years but then it pays higher dividends as an offset to fantastic growth.....I expect it to earn about $1.40 this year which on a 20X earnings is $28....then there is the major US acquistion which they've search for for about 5 years....I think there is some value but am not that confident about the share price in the near term since it certainly ran hard

 

[Rainmaker2000]

Re: FLT - Flight Centre

Hey ROE, I took you advice....hehe...well and that really uneasy feeling in my gut and cashed the vast majority of my FLT booty.......the share price performance in last 4 months has been just ridiculous and whilst I value it at more say, next financial year, the price has gone past the fundamentals, I got weak and sold most of it..........it's been going up $1 a day this week to $29.....I've got a margin loan, the cost of debt is rising.....it just does not make sense to have stocks at such valuations........Since buying June last year, FLT has been my best investment ever and its time to repay the bankers who made it possible

 

[neinstein]

Re: FLT - Flight Centre

I'm looking at the market depth for this stock and I'm curious about it, there are heaps of very small parcels being traded. Only quantities in the 10s, even a single share and a 6 share parcel. All these seem to be bringing the price up from -3% an hour ago to now -0.5% towards the end of the day. What sort of activity would this be?

 

[Jochi]

Re: FLT - Flight Centre

@ neinstein

This could be some instis trying to gap up the price by buying small parcels at increasing prices with little or no selling resistance.

This is usually done to tempt people into buying into shares at high prices.

(Just my opinion, and DYOR)

 

[ROE]

Re: FLT - Flight Centre

Damn havent look this stock for a while tank from $30 to $18
it will tank further with airline fuel sky rocket and less and less people travel
then it's my turn to buy back in

Rainmaker aren't you glad you go out in their high 20's

 

[oldblue]

Re: FLT - Flight Centre

@ neinstein

This could be some instis trying to gap up the price by buying small parcels at increasing prices with little or no selling resistance.

This is usually done to tempt people into buying into shares at high prices.

(Just my opinion, and DYOR)

Yes, that's a possible explanation.
Another reason often given for this phenomenon is " computer generated trading" - small transactions with the aim of buying or selling a parcel at an average price ( for the day or some other period).
I prefer your explanation !

 

[ROE]

Re: FLT - Flight Centre

Hello long time no see
I'm back in the game this week for this stock having sold out last year

 

[Rainmaker2000]

Re: FLT - Flight Centre

hehe, Back in the game ROE....

I've been edging my way back into the stock since the $16 and just can't believe the luck in picking it up at todays price......just incredible.....what's the PE on probably a declining year 5 X.....just amazing.

You'll be thanking yourself you picked this baby up......it will probably pay for itself in dividends in about 5 years...

I'm still enthused about the growth prospects......I think the Liberty acquistion will be the best thing ever for FLT but will take time......then there is the growth in business travel......and then there's the bike shops and opportunistic property forays......

Go the rational market theory!!

 

[ROE]

Re: FLT - Flight Centre

hehe, Back in the game ROE....

I've been edging my way back into the stock since the $16 and just can't believe the luck in picking it up at todays price......just incredible.....what's the PE on probably a declining year 5 X.....just amazing.

You'll be thanking yourself you picked this baby up......it will probably pay for itself in dividends in about 5 years...

I'm still enthused about the growth prospects......I think the Liberty acquistion will be the best thing ever for FLT but will take time......then there is the growth in business travel......and then there's the bike shops and opportunistic property forays......

Go the rational market theory!!

Yeah worse case scenario if earning drop by 30% stock still a healthy PE of 8-9 and if it's not well the stock pay for itself in 5 years

 

[rryall]

Re: FLT - Flight Centre

Hello all - I am new to the stock market in the last 6 months. I am curious about peoples opion on this stock. Low debt and market lead. I bought in today at $8.36, looking long term 5+ years.

 

[ROE]

Re: FLT - Flight Centre

Hello all - I am new to the stock market in the last 6 months. I am curious about peoples opion on this stock. Low debt and market lead. I bought in today at $8.36, looking long term 5+ years.

I come and go with this stock sell out in the Bull buy back in the bear.. FLT has to do very bad for it to hit below $8 mark.
other travel agencies will go before FLT goes..so they could potentially takes up more market share by the time the next bull return..In time like these only the strong survive and the weak get wiped out.

 

[prawn_86]

Re: FLT - Flight Centre

Missed picking these up under $9 .

Resistance at $10, but is it a head and shoulders forming over the last few days? Any TA much appreciated.

 

[gav]

Re: FLT - Flight Centre

Analysts says Flight Centre could soar

The Daily Telegraph

January 02, 2009 04:01am

Opportunity ... analysts say Flight Centre will offer good value as market conditions improve.

AUSTRALIA'S shares were punished in 2008, the All Ordinaries index hammered 43 per cent, so it'll take a brave investor to confidently pick stocks to buy right now.

But analysts say 2009 will offer a "once in a lifetime" chance to buy quality stocks as market conditions will improve and asset prices rise once again.

Investors wanting to steer a path through the capital market storm must aim for a balanced portfolio and avoid schemes sounding too good to be true.

Analysts at the The Intelligent Investor - which reveres people like former economist Benjamin Graham and his well-known disciple Warren Buffett - nominated Flight Centre, Harvey Norman, Platinum Asset Management, JB Hi-Fi and litigation funder IMF among their favourite stocks to buy in 2009.

Intelligent Investor's James Greenhalgh said Flight Centre was a "classic growth company with the potential to expand in ... corporate travel".

"To me Flight Centre looks to be one of the cheapest blue chips around."

Seven of eight Intelligent Investor analysts, including veteran picker Greg Hoffman, rated FLT a buy.

Despite many regretting not selling at $32, it is seen as good buying near $7.30. FLT closed at $7.80 on Wednesday.

"Top of my shopping list at the moment is (FLT). I've been absolutely astonished by this stock's movements over the past few years," analyst James Carlisle said. "After tripling in the space of two years, we are now roughly back to where we started, yet the long-term value ... has hardly changed at all."

 

[Rainmaker2000]

Re: FLT - Flight Centre

That article must be the dodgiest piece of journalism ever.........but cause it turned up on news.com front page....the stock jumped a clean $1...

For a start, "AUSTRALIA'S shares were punished in 2008, the All Ordinaries index hammered 43 per cent, so it'll take a brave investor to confidently pick stocks to buy right now."

Is it only brave investors who like buying stocks at a 43% discount to last year.......in FLT's case, much more discount.........FLT could easily afford $1 in dividends from operating cashflow.......what the hell is brave about buying that at this price?

Those folks at Intelligent Investor are not really stock analysts which is a term more used for people who work in brokerage houses.....this is important distinction since these guys still liked FLT at $30 whereas......they just love the stock..hardly news

Despite the author's naivity, Benjamin Graham was not an economist.....what an insult.......since he taught Buffett, that would make Buffett close to being an economist.......what a slur on his reputation.

The article, with its many words, actually gives no intelligence whatsoever...

How about......"Flight Centre will offer good value as market conditions improve"......what a joke......the whole point is that the value is there now just like at $32, which is what the story's "source" says

The author gives actually no insight was to why the stock is cheap...no numbers...no growth avenues.........just plain fluff affecting 1000's of ordinary people's investment values

 

[prawn_86]

Re: FLT - Flight Centre

I have to agree with you Rainmaker, it was a terrible article.

Even worse so for me as i was/am waiting for an entry below $8 and then this drivvle comes out forcing the masses to buy in. I wonder what proportion of the buyers yesterday are just retail investors who read the article?

It will be interesting to see what it does from here actually. Wilkl the TA people pick it up and it go for a bit more of a run, or will it slowly drift dwon again cause its not front page news (not that there was any 'news')

 

[oldblue]

Re: FLT - Flight Centre

Any article quoting the Intelligent Investor's picks should carry a prominent warning regarding that publication's record in 2008, a year in which they repeatedly called "Buy" on a variety of stocks stuck in confirmed downtrends: Timbercorp, Infomedia, PTM ( all the way down from its post-float high!), MOC, just to mention those that immediately come to mind.