Why Webjet Limited (ASX:WEB) shares raced to an all-time high today

One of the best performers on the Australian share market on Thursday has been the Webjet Limited (ASX: WEB) share price.

At one stage the online travel agent’s shares were trading at an all-time high of $13.72. They have since given back some of these gains, but still sit 4.5% higher at $13.64.

Why did Webjet’s shares hit an all-time high?

With no news out of the company, today’s gain is likely to be in relation to an upbeat broker note out of Morgan Stanley this morning.

Although the broker has only upgraded Webjet’s shares to an equal-weight (hold) rating with a $12.60 price target, the removal of the underweight (sell) rating appears to have gone down well with the market.

According to the note, the broker has made the move on the belief that positive global hotel trade is providing Webjet’s business to business segment with strong tailwinds.

While Morgan Stanley still has concerns over its weak cash conversion and structural challenges, it isn’t enough to prevent an upgrade to its rating and price target.

Should you invest?

Despite Webjet’s shares racing to an all-time high today they still only trade at a reasonably respectable 22x estimated FY 2019 earnings, based on Morgan Stanley’s forecasts.

I think this is a fair price to pay for a company benefiting greatly from the shift to online booking and the inbound and outbound tourism boom that Australia continues to experience.

In light of this, I would suggest that investors consider picking up shares in Webjet with a long-term and patient view.

Further, although the whole travel industry is well-positioned for growth, my preference remains Webjet ahead of industry peers Flight Centre Travel Group Ltd (ASX: FLT) and Corporate Travel Management Ltd (ASX: CTD) largely on valuation grounds.

Finally, if you like growth shares such as Webjet, then I think you'll love these top mid cap growth shares which have the wind in their sails.

The Disruptors: 3 Revolutionary Aussie Companies to Back for 2018

We’re living in one of the most exciting times in investing history. Innovation and a booming culture of entrepreneurship are constantly creating new companies with the potential to make forward-thinking investors very rich. Now more than ever, one small, smart investment could make a huge difference to your wealth.

That’s why at The Motley Fool we’ve been scrutinizing the ASX to uncover the kinds of companies that we believe could turn into the next Cochlear or REA Group.

We’ve found three exciting companies that we believe re poised to perform in the new year. Click here to uncover these ideas!

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Corporate Travel Management Limited and Flight Centre Travel Group Limited. The Motley Fool Australia has recommended Webjet Ltd. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

5 ASX Stocks for Building Wealth After 50

I just read that Warren Buffett, the world’s best investor, made over 99% of his massive fortune after his 50th birthday.

It just goes to show you… it’s never too late to start securing your financial future.

And Motley Fool Chief Investment Advisor Scott Phillips just released a brand-new report that reveals five of our favourite ASX stocks for building wealth after 50.

– Each company boasts strong growth prospects over the next 3 to 5 years…

– Most importantly each pays a generous dividend, fully franked.

Simply click here to find out how you can claim your FREE copy of “5 ASX Stocks for Building Wealth After 50.”

See the stocks now