TUI share price on the rise ahead of first-half results
Fundamental and technical analysis on TUI ahead of its H1 2024 results.
TUI share price on the rise ahead of first-half results
First-half results from travel firm TUI are expected to show a general improvement, though the firm’s departure from the London market is still on schedule.
Upcoming results
TUI is set to report its half-year results on Wednesday ahead of delisting from the London Stock Exchange on 24th June to move its listing to Germany.
Analysts expect the Hanover-headquartered firm to leave London in style, forecasting record first-quarter (Q1) revenue of €4.3 billion and a maiden Q1 underlying operating profit, albeit a small one. Strong demand for travel has seen the share price recover well in recent months, up nearly 60% from October’s lows.
Bookings and outlook
Winter bookings at TUI were up eight per cent at the last count, with average ticket prices up an average of four per cent in key markets. However, the focus will now turn to the all-important summer season. With just 32 per cent of summer bookings sold at the time of the Q1 results, investors will be hoping for a much higher number and not at the expense of lower prices. TUI's full-year guidance anticipates revenue rising by at least 10 per cent, alongside a 25 per cent jump in underlying operating profit.
Signs of momentum in the travel industry
The signs so far suggest this summer will be a busy one for the travel industry. British Airways owner the IAG forecast another record summer last week as it reported Q1 operating profits of €68 million, ahead of analysts' expectations.
In TUI's interim results in February, revenue reached €4.3 billion, up 15 per cent, driven by higher prices and passenger numbers increasing by six per cent to 3.5 million.
TUI's delisting on June 24th has fuelled City concerns over the state of the UK capital's embattled equity markets. The travel giant's listing will be struck off, a move that has added to worries about London's ability to retain major companies.
How to trade TUI into the results
LSEG Refinitiv data shows a consensus analyst rating of ‘buy’ for TUI with 1 strong buy, 6 buy and 4 hold – and a mean of estimates suggesting a long-term price target of €10.00 for the share, roughly 43% higher than the current price (as of 14 May 2024).
Technical analysis of the TUI share price
TUI’s share price, which rose from its October 2023 record low at €4.366, to its April peak at €8.018 before rapidly dropping to its mid-January low at €6.544, has been range trading above this low for the past month. It is greatly underperforming the DAX 40’s around 9% year-to-date gains by still trading in the red by around 3% ahead of Wednesday’s Q1 earnings.
TUI Weekly Candlestick Chart
While the April trough at €6.544 underpins on a daily chart closing basis, the July and December 2023 as well as February 2024 highs at €7.344 to €7.410 will remain in sight, together with this year’s April peak at €8.018.
TUI Daily Candlestick Chart
Failure at the April low at €6.544 on a daily chart closing basis would likely lead to the January-to-March lows at €6.026 to €5.970 being back in play.
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