Webjet (ASX:WEB) recently released their full year results and they contained some disappointing aspects. This contributed to the weakness in the share price post results release. After tumbling from $17 to $11, there could be an opportunity here.
The collapse of UK travel company, Thomas Cook after 178 years in business will leave an impact across every part of the global holiday and business travel businesses, with costs estimated to easily top $A2 billion.
Shares in listed online travel retailer Webjet ended down 3.5% yesterday after a slide on the back of surprise news that the company had been caught short with the failure of UK travel business, Thomas Cook.
Morgan Stanley reduces estimates for operating earnings (EBITDA) by -6-7% for FY20. This reflects adjustments for Thomas Cook and Amoma, both having permanently ceased operations. The broker notes a significant hit in terms of receivables, which will be written down to zero.
Morgan Stanley reduces B2B forecasts for FY20 by -18%. After a softer performance from JacTravel and earnings downgrades at Thomas Cook, which resulted in a decline in the share price of over -70%, the broker envisages downside risk to previous numbers.