Led by lagging markets like the UK, Canada, India and Southeast Asia, the third quarter’s total transaction value was circa 16% of “normal” levels as compared to the first half’s 14%, according to Flight Centre’s latest update.
Flight Centre has guided to a second-half profit before loss of circa $247m, worse than Morgan Stan;ey’s prior estimated loss of around -$50m.
Post-Flight Centre’s update, Morgan Stanley finds the recovery profile of the company uncertain. While the equity value appears to be broadly in line with pre-covid levels, the broker notes there is considerable execution risk around better post-covid earnings.
Underweight with the target dropping to $16 from $17.50. Industry view: Attractive.
Sector: Consumer Services.
Target price is $16.00.Current Price is $16.14. Difference: ($0.14) – (brackets indicate current price is over target). If FLT meets the Morgan Stanley target it will return approximately -1% (excluding dividends, fees and charges – negative figures indicate an expected loss).