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Helloworld Ltd surges on positive new: Should you bet on it for 2015?

Helloworld Ltd (ASX: HLO) shares have skyrocketed today after the company announced that one of its subsidiaries, QBT Limited, had been appointed as the sole provider of travel management services to the Australian government.

The shares surged as much as 50% to 39 cents before settling at around 35.5 cents late in the session.

So What:

Until now, QBT has provided travel management services to 58 Australian government agencies which has comprised roughly 65% of the total travel management related TTV (total transaction value) generated by the government.

Under the new arrangement however, QBT will provide services to each of the 142 Australian government agencies, where services will include travel management, an online portal and booking tool, reporting and offline booking services. The appointment will last for an initial period of four years while the government’s transition will occur over the six-month period to 1 July 2015.

The news tops off a busy week for Helloworld which also announced a partnership with travel insurance provider Cover-More Group Ltd (ASX: CVO) just days ago.

Now What:

Helloworld’s shares have been stuck on a downward trajectory over the last 12 months but the deal with the government could provide a significant boost in returns over the coming years. Trading on a P/E ratio of just 8.7 times earnings, Helloworld is a stock to watch going forward!

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Motley Fool contributor Ryan Newman does not own shares in any of the companies mentioned. You can follow Ryan on Twitter @ASXvalueinvest.

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