ASX All Ords stock Webjet Group (ASX: WJL) has had a tough run since the company 's demerger from Web Travel Group Ltd (ASX: WEB) last September.
How tough?
Well, since market close on 27 September, the Webjet share price has plunged 42%.
For some context, the All Ordinaries Index (ASX: XAO) is down 2.2% over this same period.
The ASX All Ords stock has been struggling as high interest rates and sticky inflation have impacted demand for its services.
At Webjet's half year results in November (its first report as an independent company), management noted that "ongoing cost of living pressures continue to subdue demand for travel, particularly for domestic flights".
But with interest rates widely expected to come down in 2025, perhaps as early 20 May when the Reserve Bank of Australia (RBA) next meets, now could be an opportune time to buy the very deep dip on Webjet shares.
That's according to Red Leaf Securities' John Athanasiou (courtesy of The Bull).
Why this ASX All Ords stock is a buy
"WJL was formed in September 2024 after Webjet Limited shareholders approved a demerger to enable two listed parent companies," said Athanasiou, who has a buy recommendation on the ASX All Ords stock.
Athanasiou explained:
WJL operates Australia and New Zealand's online travel agent (OTA) business. WJL also operates GoSee, a global motor home and car rental e-commerce site and Trip Ninja, a travel technology business.
And he's bullish on Webjet's business reset, noting, "This reset is aimed at unlocking value and improving agility."
As for interest rates cuts and the growth outlook for Webjet shares, Athanasiou said:
A strategic re-investment in brand and customer experience amid a potential tailwind from lower interest rates that encourages travel leaves WJL well placed for growth in the long term.
What's been happening with Webjet since the demerger?
With the crashing Webjet share price having also materially lowered the company's market cap, Webjet was removed from the S&P/ASX 300 Index (ASX: XKO) on 24 March as part of the S&P Dow Jones Indices March quarterly review.
There hasn't been much other news out from Webjet post its demerger aside from its initial half year results.
Commenting on the outlook for the ASX All Ords stock at the time, Webjet managing director Katrina Barry said:
As outlined in our demerger investor presentation, we have clear and robust strategic priorities to deliver growth and enhance our leadership positions in online travel marketplaces.
Our planned initiatives are progressing well with several showing exciting potential and we are accelerating investment in technology platforms and other key growth drivers. With the demerger now behind us, Webjet Group is solely focused on growth…
And according to Red Leaf Securities' Athanasiou, the ASX All Ords stock could be set to deliver on that growth, potentially with a little help from lower interest rates.
