Similar thoughts - I doubled my holdings today at $10.64 and will purchase another tranche if the share price comes back a little more. I was keen to increase my position in the company prior to AGM on November 20 where an update on EBITDA guidance will be provided.
For the year ending 30 June 2019, Adjusted EBITDA for Webjet as a whole was $124.6 million. The WebBeds business is now the largest in the company producing $67.3 million of the company's total EBITDA and recorded revenue growth of 62% and EBITDA growth of 68% year on year. EBITDA margins also improved from 23.8% to 36.4% year on year as TTV improved. (Page 7 FY 19 Results Presentation)
Webjets recent update to the Market "Excluding Thomas Cook, for the 10 weeks of trading for FY20 year to date, WebBeds TTV continues to be up more than 50% over the prior corresponding period."
Even if TTV only increases 30% from last year and margins remain the same, FY20 EBITDA should be significantly higher and hopefully result in a re-rating of the company. Assuming EBITDA increases to $162 million for FY 20, the EBITDA multiple is only 9 based on current price. Seems like good a buying opportunity for a stock that is considered a growth company as even ORD Minnet are expecting EBITDA growth of 13.7% per annum growth over the next 10 years according to other Hotcopper posters. Good luck to all.... I'm no expert in this and only my thoughts. Just hoping for a positive update on WebBeds at the AGM on November 20 but I also intend to hold long term....
WEB Price at posting:
$10.63 Sentiment: Buy Disclosure: Held
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