This report is an updated version of the report published on 15 November 2024 at 1:23 PM AEDT.

Flight Centre Travel Group Ltd (ASX: FLT)

Flight Centre Travel Group Ltd (ASX: FLT) provides travel-related services including leisure and corporate travel solutions, encompassing flights, accommodations, holiday packages, tours, and car rentals.

Recommendation Rationale - SELL at AUD 17.700

• Facing Resistance: FLT has surpassed Resistance 1 level recommended on 28 October 2024; thus, it can face resistance at the current levels.
• Overvalued Multiples: On a forward 12-month basis – FLT’s key trading multiples (EV/Sales, Price/Book, and Price/Cash Flow) are trading higher than the median of Consumer Cyclicals sector.
• Economic Sensitivity: FLT's business is highly dependent on the global travel industry, which is sensitive to economic downturns, geopolitical events, and pandemics.
• FY25 Outlook: FLT stated that earnings are expected to be heavily weighted towards second half due to seasonality factor in leisure and corporate sector booking. The Q1 FY25 started with cyclical challenges compared to more consistent trading period in FY24.

FLT Daily Chart

(Source: REFINITIV; Analysis by Kalkine Group)

Valuation Methodology: Price/Cash Flow Approach (FY Jun'25E) (Illustrative)

FLT is expected to trade at a discount due to international political instability, customers continue to shift toward online platforms or self-service options. For conducting the valuation, the following peers have been considered: Helloworld Travel Ltd (ASX: HLO), G8 Education Ltd (ASX: GEM), and Domino's Pizza Enterprises Ltd (ASX: DMP).

Considering that the stock has crossed its R1 level, market uncertainties, and risks associated, the share price can witness some correction at the current levels. Hence, a ‘Sell’ recommendation is given on the stock at the current market price of AUD 17.70, as of 15 November 2024, at 10:55 AM AEDT.

Markets are trading in a highly volatile zone currently due to certain macro-economic issues and geopolitical issues prevailing geopolitical tensions. Therefore, it is prudent to follow a cautious approach while investing.

Note 1: Past performance is neither an indicator nor a guarantee of future performance.

Note 2: The reference date for all price data, currency, technical indicators, support, and resistance levels is 15 November 2024. The reference data in this report has been partly sourced from REFINITIV.

Note 3: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above.

Note 4: Dividend Yield may vary as per the stock price movement.

Technical Indicators Defined: -

Support: A level at which the stock prices tend to find support if they are falling, and downtrend may take a pause backed by demand or buying interest.

Resistance: A level at which the stock prices tend to find resistance when they are rising, and uptrend may take a pause due to profit booking or selling interest.

Stop-loss: In general, it is a level to protect further losses in case of any unfavourable movement in the stock prices.