It's 2022, COVID-19 restrictions are continuously easing across Australia and around the world, and the travel sector appears to be regaining some lost ground lost. That's surely good news for the Flight Centre Travel Group Ltd (ASX: FLT) share price, right?
Well, that depends on who you ask.
Flight Centre shares have dumped 19.31% so far this year to trade at $15.03 at the time of writing.
That's more than 50% lower than they were trading prior to the pandemic. Though, the stock has lifted around 70% from its March 2020 low.
Comparatively, the S&P/ASX 200 Index (ASX: XJO) has slipped 10% so far this year and around 5% since COVID-19 took markets by storm.
So, what might the future hold for Flight Centre shares? Let's take a look.
Image source: Getty Images
Could Flight Centre shares offer 30% upside?
While most brokers remain neutral on Flight Centre shares, many are tipping a notable upside for the stock.
But before we get to the bulls, let's check in with the company's short position.
Flight Centre has been the market's most shorted stock for the whole of 2022 so far. Nearly 15.6% of its shares were in the hands of short sellers at last count. That means plenty of market participants believe the travel share will slip further.
Yet, Morgans, for one, is relatively optimistic on the ASX 200 travel giant. Though, the broker has noted several risk factors facing the company.
It has a hold rating and an $18.25 price target on the stock, my Fool colleague James reports.
On the company's financial year 2022 results, Morgans senior analyst Belinda Moore said the broker expects Flight Centre to post "a strong recovery" this fiscal year.
However, its changing business model, execution, and reduced front-end airline commissions were flagged as having the potential to weigh on earnings.
Meanwhile, Flight Centre hasn't provided guidance for financial year 2023, blaming an uncertain outlook for the industry's post-COVID recovery.
Though, it did return to an underlying earnings before interest, tax, depreciation, and amortisation (EBITDA) profit late in financial year 2022.
Goldman Sachs is more hopeful for the Flight Centre share price.
It has tipped the stock to lift 30% to $19.60. The broker also expects the company to return to dividends next financial year.
