Which ASX 200 travel share is the best to buy now?

Corporate Travel, Flight Centre, or Webjet? Which is the best one to buy.

| More on:
A girl holds a ticket and a passport in either hand and has a confused, vexed look on her face as though she is unsure.

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

There are plenty of options for investors to choose from in the travel sector.

Investors could opt for Corporate Travel Management Ltd (ASX: CTD), Flight Centre Travel Group Ltd (ASX: FLT), or Webjet Limited (ASX: WEB), to name just three.

But for the team at Goldman Sachs, one of these ASX 200 travel shares currently stands head and shoulders above the others.

Which ASX 200 travel share is a top buy?

According to a note out of the investment bank, its analysts have a preference for Corporate Travel Management right now.

Goldman has a buy rating and a $21.60 price target on the corporate travel specialist's shares. This implies a potential upside of over 23% for investors over the next 12 months.

And while the broker sees decent (14%) upside for Flight Centre shares with its price target of $22.50, it only has a neutral rating on them at present.

Finally, it is a similar story for Webjet shares, with the broker holding firm with its neutral rating and a price target of $7.70 offering almost 13% upside for investors.

What did Goldman say?

Goldman Sachs sees Corporate Travel Management as the best ASX 200 travel share to buy right now due to its attractive valuation and strong organic and inorganic growth opportunities in a highly fragmented industry. It explains:

Managed travel is a fragmented industry with the top 5 players only representing 32% market share (as of 2022). We view the increasingly complex travel market as offering opportunities for growth, especially in the SME space and government contracts. CTD holds a strong balance sheet and is well positioned to take advantage of organic and inorganic growth opportunities and recovery remains skewed to North America where we see relatively lower macro risks.

The stock currently trades at an ~10% discount to average historical P/E despite the growth outlook being ahead of historical levels. We expect ongoing data updates on business travel, updates from global corporate peers and key company updates to drive re-rating of the stock.

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Corporate Travel Management and Goldman Sachs Group. The Motley Fool Australia has recommended Corporate Travel Management and Flight Centre Travel Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Travel Shares

A happy woman flies with arms outstretched on her boyfriend's back on the beach at dusk.
Travel Shares

Is the Qantas share price too low to ignore?

Can this ASX stock fly again?

Read more »

Man sitting in a plane looking through a window and working on a laptop.
Travel Shares

Why did ASIC take a look when Qantas shares fell last year?

The regulator was asking questions.

Read more »

Two kids wearing pilot's goggles take flight down the runway on their tummies with arms outstretched like wings.
Travel Shares

Up 6% in FY 2024, what's ahead for the Flight Centre share price in FY 2025?

The Flight Centre share price could be poised for big gains in FY 2025. But why?

Read more »

Man sitting in a plane seat works on his laptop.
Travel Shares

Why did the Qantas share price fly backwards in FY 2024?

Despite surging revenues, the Qantas share price lost ground in FY 2024. But why?

Read more »

Man sitting in a plane seat works on his laptop.
Travel Shares

Qantas share price drops 3% amid Qatar rumours

Qantas shares had a turbulent start to trading this morning...

Read more »

A jet plane takes off representing the qantas share price rising on the ASX this week
Travel Shares

Qantas shares lift amid new investment in next-generation aircraft

Qantas' next generation aircraft could cut costs, travel time and emissions.

Read more »

A businessman slips and spills his coffee.
Travel Shares

ASX 200 travel share slips on latest demerger news

The ASX 200 travel company is looking to split into two separately listed businesses.

Read more »

A woman sits crossed legged on seats at an airport holding her ticket and smiling.
Travel Shares

Can the Qantas share price keep flying higher in FY25?

Can Qantas impress the market in the 2025 financial year?

Read more »