On Wednesday the Flight Centre Travel Group Ltd (ASX: FLT) share price continued its poor run and sank to a 52-week low of $39.69.
This latest decline means the global travel agent's shares have now lost almost 44% of their value since peaking at $70.53 in August.
Why is the Flight Centre share price at a 52-week low?
Investors have been heading to the exits in their droves since the release of Flight Centre's FY 2018 results in August last year.
Although the travel agent delivered a strong result which came in at the top end of its guidance range, investors were surprised to see a decline in earnings from its key Australian Leisure business during the second half.
This weakness has continued in FY 2019, with management describing the performance of its Australian Leisure business as "disappointing" during the first half. This was blamed on a volatile trading climate.
Whilst management advised that further enhancements are being made "to address the issues that are impacting results," it warned that the volatility has persisted early in the second half and ahead of its busiest trading months.
I suspect that investors are concerned that the company will fall short of its full year guidance. At its last update, it advised that it was tracking towards the bottom of its underlying profit before tax guidance range of between $390 million $420 million.
Should you buy the dip?
Whilst I would still choose Webjet Limited (ASX: WEB) ahead of it, with Flight Centre's shares now changing hands at around 14.5x estimated forward earnings, I feel they could be a good option for patient investors.
Though, this is highly dependant on the performance of the company's Australian Leisure business not deteriorating further.
Elsewhere, another travel share trading at a 52-week low is Helloworld Travel Ltd (ASX: HLO). Its shares have come under pressure after being caught up in a political scandal and could also be worth a closer look at this level.
