September 28, 2023
Top 10 Stock Flight Centre Travel Buy Recommendation
How to read the ranks
For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".
Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".
Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.
Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.
(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).
(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.
Snapshot: Flight Centre Travel – Top 10 Stock in Australian Securities Exchange Index ASX 300
Flight Centre Travel is listed as a top 10 stock on September 28, 2023 in the market index ASX 300 because of its high performance in at least one of the Obermatt investment strategies. While half the consolidated Obermatt Ranks are above-average, investor sentiment is below average and thus a signal for caution. Based on the Obermatt 360° View of 70 (high 70% performer), Obermatt assesses an overall buy recommendation for Flight Centre Travel on September 28, 2023.
Snapshot: Obermatt Ranks
When Obermatt identifies the Top 10 stocks in a market, it’s based on a certain investment strategy. The best performing stocks usually aren’t the ones that everyone is talking about (those are often "over-priced" and have low Value ranks).
For each investment strategy, we provide you with more detailed analysis and our recommendation. You see the ranks of the top 10 stocks ranked by that particular investment strategy (360° View, Sentiment, Value, Growth, Safety and Combined Financial Performance).
360° View: Obermatt 360° View Flight Centre Travel Buy
| 360 METRICS | September 28, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 69 |
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| GROWTH | ||||||||
| GROWTH | 87 |
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| SAFETY | ||||||||
| SAFETY | 48 |
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| SENTIMENT | ||||||||
| SENTIMENT | 38 |
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| 360° VIEW | ||||||||
| 360° VIEW | 70 |
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ANALYSIS: With an Obermatt 360° View of 70 (better than 70% compared with alternatives), overall professional sentiment and financial characteristics for the stock Flight Centre Travel are above average. The 360° View is based on consolidating four consolidated indicators, with half of the metrics below and half above average for Flight Centre Travel. The consolidated Value Rank has an attractive rank of 69, which means that the share price of Flight Centre Travel is on the lower side compared with the typical size in indicators such as revenues, profits, and invested capital. This means the stock price is lower than for 69% of alternative stocks in the same industry. The consolidated Growth Rank has a good rank of 87, which means that the company experiences above-average growth momentum when looking at financial metrics such as revenue, profit, and invested capital growth as well as stock returns. But the professional market sentiment is below average compared with other stock investment alternatives with a Sentiment Rank of 38. Professional investors are more confident in 62% other stocks. Worryingly, the company has risky financing, with a Safety rank of 48. This means 52% of comparable companies have a safer financing structure than Flight Centre Travel. ...read more
RECOMMENDATION: With a consolidated 360° View of 70, Flight Centre Travel is better positioned than 70% of all alternative stock investment opportunities based on the Obermatt Method. Even though half of the consolidated Obermatt Ranks are above-average, namely the Value Rank at 69 and the Growth Rank above-average at 87, the picture is still mixed. The professional investor community is skeptical, with the Sentiment Rank below-average at 38. In addition, the company financing structure is on the riskier side (Safety Rank of 48). Since the company is good value and the share price low, it should attract investors, yet professionals are skeptical. One may be tempted by above-average growth, but that could also change quickly, as past performance is not a good indicator of future performance. Since the financing structure is on the risky side, investors should be careful with this decision and conduct further research if they are serious about investing in this company. ...read more
Sentiment Strategy: Professional Market Sentiment for Flight Centre Travel only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 38 (better than 38% compared with alternatives), overall professional sentiment and engagement for the stock Flight Centre Travel is below industry average. The Sentiment Rank is based on consolidating four sentiment indicators, with half of the indicators below and half above average for Flight Centre Travel. Analyst Opinions are at a rank of 54 (better than 54% of alternative investments), which means that currently, stock research analysts tend to recommend a stock investment in the company. Market Pulse is also positive with a rank of 54, which means that the current professional news and professional social networks are positive when discussing this company (more positive news than for 54% of competitors). But Analyst Opinions Change is negative with a below 50 rank of 10, which means that stock research experts are changing their opinions for the worse in recommending the company. In other words, they are getting more critical of investments in Flight Centre Travel. There are also only so many institutional investors holding company stock with a Professional Investors rank of 45, which means that, currently, professional investors hold less stock in this company than in 55% of alternative investment opportunities. Pros tend to invest in other companies. ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 38 (less encouraging than 62% compared with investment alternatives), Flight Centre Travel has a reputation among professional investors that is below that of its competitors. The signals are ambivalent. The positive news in the market contradicts the negative change in analyst recommendations. Since the overall analyst recommendations are still above average, the stock may be safer for investing, especially if it is not an extra-large company where Pros tend to be less present. In such a case, the Pro Investor rank is not a problem. ...read more
Value Strategy: Flight Centre Travel Stock Price Value better than average
ANALYSIS: With an Obermatt Value Rank of 69 (better than 69% compared with alternatives), Flight Centre Travel shares are more attractively priced than the majority of comparable stocks. The Value Rank is based on consolidating four value indicators, with three out of four indicators above average for Flight Centre Travel. Price-to-Sales (P/S) is 51, which means that the stock price compared with what market professionals expect for future sales is lower than for 51% of comparable companies, indicating a good value concerning Flight Centre Travel's revenue size. The same is valid for expected Price-to-Profits (or Price / Earnings, P/E), more favorable than for 66% of alternatives. It is also positive for expected dividend yields with a Dividend Yield rank of 66 (dividends are expected to be higher than 66% of other stocks). But, compared with other companies in the same industry, the Price-to-Book Capital ratio (also referred to as market-to-book ratio) is higher than average, making the stock more expensive. Only 66% of all competitors have an even higher price compared with book capital which puts the Price-to-Capital Rank for Flight Centre Travel to 34. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 69, is a buy recommendation based on Flight Centre Travel's stock price compared with the company's operational size and dividend yields. A low level of book capital means that the company has a business that is leaner in assets than its competitors. For instance, the company could be leasing its production facilities or be more focussed on intellectual property, such as its brand and software, which is less visible in its book capital. If that is the case, the three good value ranks for Sales, Profits, and Dividends are reliable indicators for the stock price value. ...read more
Growth Strategy: Flight Centre Travel Growth Momentum high
| GROWTH METRICS | September 28, 2023 | |||||||
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| REVENUE GROWTH | ||||||||
| REVENUE GROWTH | 52 |
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| PROFIT GROWTH | ||||||||
| PROFIT GROWTH | 90 |
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| CAPITAL GROWTH | ||||||||
| CAPITAL GROWTH | 54 |
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| STOCK RETURNS | ||||||||
| STOCK RETURNS | 89 |
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| CONSOLIDATED RANK: GROWTH | ||||||||
| CONSOLIDATED RANK: GROWTH | 87 |
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ANALYSIS: With an Obermatt Growth Rank of 87 (better than 87% compared with alternatives) for 2023, Flight Centre Travel shows one of the highest growth dynamics in its industry. Investors also speak of high momentum. The Growth Rank is based on consolidating four value indicators, with all four indicators above average for Flight Centre Travel. Sales Growth has a value of 52, which means that, currently, professionals expect the company to grow more than 52% of its competitors. The same is valid for Profit Growth with a value of 90 and for Capital Growth with 54. In addition, Stock Returns had an above-average rank value of 89, which means they have been higher than 89% of comparable investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 87, is a buy recommendation for growth and momentum investors. Since all Growth Ranks are positive, Flight Centre Travel exhibits above-average growth momentum. This could be due to a uniquely strong market position, proprietary technology, or an extensive corporate acquisition strategy. Growth investors will find this an attractive investment opportunity, unless they expect that the current phase is transitory and will deteriorate in the future. The current performance could also be a temporary recovery from a very low point, such as a turn-around situation. In the case of a turn-around, the current performance may or may not be followed by a continuing positive development. ...read more
Safety Strategy: Flight Centre Travel Debt Financing Safety below-average
| SAFETY METRICS | September 28, 2023 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 30 |
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| REFINANCING | ||||||||
| REFINANCING | 83 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 30 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 48 |
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ANALYSIS: With an Obermatt Safety Rank of 48 (better than 48% compared with alternatives), the company Flight Centre Travel has financing practices on the riskier side, which means that their overall debt burden is above the industry average. This doesn't mean that the business of Flight Centre Travel is also risky, it only means that the company is on the riskier side in respect to bankruptcy in case things turn sour, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with just one indicator above average for Flight Centre Travel and the other two below average. Refinancing is at 83, meaning the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 83% of its competitors. But Leverage is high with a rank of 30, meaning the company has an above-average debt-to-equity ratio. It has more debt than 70% of its competitors. Liquidity is also on the riskier side with a rank of 30, meaning the company generates less profit to service its debt than 70% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 48 (worse than 52% compared with alternatives), Flight Centre Travel has a financing structure that is riskier than that of its competitors. A good Refinancing Rank means that the problems of the company may not be around the corner. But high Leverage is only good if things go well, and low Liquidity is a signal for caution. The financing signals for Flight Centre Travel are on the riskier side, requiring the company's future to be on the safer side. Investors may want to look at Growth and Sentiment ranks before making an investment decision. ...read more
Combined financial peformance: Flight Centre Travel Top Financial Performance
| COMBINED PERFORMANCE | September 28, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 69 |
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| GROWTH | ||||||||
| GROWTH | 87 |
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| SAFETY | ||||||||
| SAFETY | 30 |
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| COMBINED | ||||||||
| COMBINED | 88 |
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ANALYSIS: With an Obermatt Combined Rank of 88 (better than 88% compared with investment alternatives), Flight Centre Travel (Hotels, Resorts & Cruise Lines, Australia) shares have much better financial characteristics than comparable stocks. Shares of Flight Centre Travel are a good value (attractively priced) with a consolidated Value Rank of 69 (better than 69% of alternatives), show above-average growth (Growth Rank of 87) but are riskily financed (Safety Rank of 48), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 88, is a strong buy recommendation based on Flight Centre Travel's financial characteristics. As the company Flight Centre Travel's key financial metrics exhibit excellent performance in two areas, such as good value (Obermatt Value Rank of 69) and above-average growth (Obermatt Growth Rank of 87), it could be argued that the risk-taking in financing (Obermatt Safety Rank of only 48) indicates that the company is optimistic about the future and sees debt as an opportunity to boost returns. More debt means more shareholder returns if everything goes well. However, higher debt burdens are risky when interest rates rise or the business deteriorates in a crisis. If you believe the company's future is market-typical or even better, this could be an argument for a share purchase. ...read more
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