The Motley Fool

Is this the best value growth share on the ASX right now?

The Helloworld Travel Ltd (ASX: HLO) share price has been pushing higher this morning on the day of its annual general meeting in Melbourne.

The travel company’s shares are currently up 1% to $5.66.

What was revealed at the annual general meeting?

The majority of Helloworld’s AGM presentation was focused on its strong performance in FY 2018.

For those that are unaware, the company posted a 3.5% increase in total transaction value (TTV) to $6,077 million and flat revenue of $326.9 million in FY 2018. Its flat revenue was the result of the impact of disposed operations and the restructure of its Insider Journey business.

Management’s focus on more profitable revenue streams and cost reductions led to strong earnings growth. EBITDA grew 18.2% to $65.2 million and net profit after tax rose an impressive 48.1% to $32 million.

How about FY 2019?

The company’s presentation included a small update on its performance so far in FY 2019.

According to the release, the new financial year has started well and the company is performing in line with expectations.

First quarter TTV was $1,700 million and revenues came in at $94 million. The latter was slightly ahead of management’s expectations and 9.5% higher than the prior corresponding period.

All of Helloworld’s segment have posted EBITDA growth so far this year, leading to quarterly EBITDA of $23 million. This is a 10.6% increase on the prior corresponding period.

In light of this positive start, management has reaffirmed its full year EBITDA guidance of between $76 million and $80 million. This represents year on year growth of approximately 16.5% and 22.7%.

Should you invest?

Despite its solid growth expectations for FY 2019, Helloworld’s shares are changing hands at just 20x earnings and offer a trailing fully franked 3.2% dividend.

I think this is great value and makes its shares a great alternative to industry peers Flight Centre Travel Group Ltd (ASX: FLT) and Webjet Limited (ASX: WEB).

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Flight Centre Travel Group Limited. The Motley Fool Australia owns shares of Helloworld 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.