Travel shares could be set to benefit from increased short term visitors in Australia.
Data from the ABS released yesterday shows in the month of June there were:
- 624,510 short-term visitor arrivals – an increase of 6.3% on one year earlier
- 1,618,090 total arrivals – an increase of 6.1% on one year earlier
This could be good news for businesses engaged in travel and tourism.
Broker Bell Potter has identified two in particular that could bring investors strong returns in the future.
Lets see what the broker had to say.
Web Travel Group Ltd (ASX: WEB)
Web Travel Group provides online travel booking services.
It is an online travel agency, which enables customers to search and book the domestic and international travel flight deals, travel insurance, car hire, and hotel accommodation worldwide.
It has fallen more than 40% in the last 12 months, but could now be a value according to Bell Potter.
Web Travel shares closed at $4.45 yesterday.
Bell Potter has an "overweight" rating and $6.39 price target.
If Web Travel shares were to reach this price target it would mean a 43.6% rise.
The broker said management anticipates an EBITDA margin of 44% to 47% for FY26, with a longer-term target of reaching 50% EBITDA margins by FY27. The company reaffirmed its target of $10 billion TTV by FY30.
Helloworld Travel Ltd (ASX: HLO)
Helloworld Travel is an Australian-based travel distribution company. It consists of a wide array of travel brands across three key pillars of its business: retail, wholesale, and inbound. Its portfolio of travel names includes Magellan Travel, Mobile Travel Agents, Viva Holidays, Sunlover Holidays, and Asia Escape Holidays.
Its share price has fallen by approximately 25% over the last year, with Bell Potter now seeing it as a value.
The broker has an "overweight" recommendation and price target of $2.20 on Helloworld Travel shares.
From yesterday's closing price of $1.72, this implies an upside of almost 28%.
