Why the Flight Centre (ASX:FLT) share price is down 16% from its year to date high

What's been impacting Flight Centre shares recently?

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A pensive-looking woman sits on a chair with her chin on her hand looking into space with a large suitcase standing beside her as she contemplates travel to Europe and the Flight Centre share price

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Key points

  • Flight Centre shares down 1.66% to $17.79 
  • The company released its half year results, reporting mixed numbers across key financial metrics 
  • A couple of brokers gave their take on what they believe Flight Centre shares should be valued at 

The Flight Centre Travel Group Ltd (ASX: FLT) share price has been on a rollercoaster ride over the course of 2022.

The company has been navigating through a series of events that have shaken the world and caused negative investor sentiment. This includes the global pandemic which halted the global economy, and now the geopolitical crisis surrounding Russia and Ukraine.

At market close, the travel agent's shares are swapping hands for $17.79, down 1.66%.

When comparing from its year to date high of $21.27 on 17 February, this represents a fall of 16.36%.

Is now the time to buy?

What has happened to Flight Centre shares lately?

Late last month, the company delivered its half year results, reporting strong top line growth.

Revenue soared 98.1% to $315.7 million, underpinned by a significant rebound in sales after the Delta spike in August/September 2021.

However, despite the robust performance, Flight Centre recorded an underlying loss of $188 million, up 4% on H1 FY21.

Management advised that this was driven partly by the prior corresponding period benefiting from $65 million of government subsidies.

And while the number of Omicron cases across the country continues to linger, the visibility of travel remains unclear.

Nonetheless, the company is hoping to achieve profit in March/April and a return to pre-COVID TTV levels in FY23.

Are Flight Centre shares a buy?

A couple of brokers weighed in on the Flight Centre share price following the company's financial scorecard.

The team at Citi cut its 12-month price target by 1.4% to $15.77 for Flight Centre shares. Based on the current share price, this implies a downside of 11.35% for investors.

On the other hand, Macquarie raised its assessment on the company's shares by 5.6% to $18.85. Its analysts believe that there is still value left in the travel agent over the next 12 months. This represents an uplift of 5.96% for Flight Centre shares at today's prices.

Flight Centre share price summary

It's been a challenging 12 months for Flight Centre shareholders, despite gaining around 6% over the period.

The company's share price reached a 52-week high of $25.28 in early October when Australia had managed the pandemic. However, since the outbreak of the Omicron variant, its shares have nosedived to April 2021 levels.

On valuation grounds, Flight Centre presides a market capitalisation of roughly $3.55 billion, with approximately 199.72 million shares outstanding.

Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Flight Centre Travel Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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