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?

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The Flight Centre Travel Group Ltd (ASX: FLT) share price closed out the financial year just past in the green. Though the S&P/ASX 200 Index (ASX: XJO) travel stock couldn't quite match the performance of the benchmark index.

Shares in the travel agent closed out FY 2023 at $19.05. On 28 June, the last trading day of FY 2024, shares ended the day changing hands for $20.18 apiece.

That saw the Flight Centre share price up 5.9% over the 12 months.

For some context, the ASX 200 gained 7.8% over this same period.

Now, that doesn't include the two fully franked dividends the company paid out over the year, totalling 28 cents a share.

FY 2024 saw the return of Flight Centre's dividends. Those were last paid in 2019 and suspended after the outbreak of the global pandemic brought domestic and international travel to a standstill in 2020.

What were ASX 200 investors considering in FY 2024?

Flight Centre reported its full-year FY 2023 results on 30 August.

Highlights included a 127% year on year increase in revenue to $2.3 billion. And after posting a loss before tax of $378 million in FY 2022, the company posted a $70 million profit before tax. This helped it end the last financial year with cash holdings of $1.3 billion.

"After an incredibly challenging period, we are pleased to report material profit and sales uplifts in improved conditions during FY23, leading to stronger shareholder returns," managing director Graham Turner said of the results.

Despite the strong growth metrics, the Flight Centre share price closed down 2.8% on the day.

Fast forward to 28 February, and we find the ASX 200 travel stock's results for H1 FY 2024.

Flight Centre reported a 565% year on year increase in half-year underlying profit before tax of $106 million. That was spurred by a 15% lift in total transaction value (TTV) of $11.3 billion.

And management reported the company was on track to beat its record FY 2019 $23.7 billion TTV result in FY 2024.

Once more, investors looked to have been expecting even more, sending the Flight Centre share price down 3.9% on the day.

That's what ASX 200 investors learned over the financial year just past.

Now, what might they expect from the Flight Centre share price in FY 2025?

What's next for the Flight Centre share price in FY 2025?

With six trading days of FY 2025 already in the bag, the Flight Centre share price is up 5.85% in the emerging new financial year, closing yesterday at $21.36 a share.

As for what we might expect in the months ahead, a lot of this will hinge on how a range of macroeconomic factors come together to impact global travel demand.

Airline ticket prices are one to watch. These will, in part, be affected by the costs of jet fuel, which represent around 20% of airlines' annual expenses.

The trajectory of inflation and interest rates, both in Australia and internationally, will also influence the overall levels of travel demand. As will the Aussie government's cost of living relief measures and the extra cash most workers can expect in FY 2025 from the new stage three tax cuts.

Should inflation and interest rates surprise to the downside, I suspect the Flight Centre share price will benefit from an uptick in travellers.

Turning to recent broker coverage, Morgans has a bullish outlook for the company in FY 2025.

The broker recently stated that, "FLT has the greatest risk, reward profile of our travel stocks under coverage."

Morgans has an add rating on Flight Centre stock, with a $27.27 share price target.

That's almost 28% higher than yesterday's closing price.

Motley Fool contributor Bernd Struben 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. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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