Stock of the day: Web Travel Group

(AI video summary)

This video was created on 27 November for IG audiences by ausbiz.

ASX code: WEB

Web Travel Group's financial performance and market reaction

Web Travel Group, recently spun out from Webjet, reported its first-half (H1) of the 2025 financial year (FY) results with mixed outcomes.

The company saw an 8% decline in underlying earnings to $70 million, despite a modest 1% revenue increase to over $170 million. Net profit after tax was $52.5 million. Group expenses rose by 8% due to investments in technology and workforce expansion.

Following a profit warning in October, the share price dropped significantly. However, analyst Ben Wilson from Wilsons suggests that the recent results might lift expectations for the next fiscal year, with potential for upgrades.

Analyst perspectives

Analysts have reacted positively to Web Travel Group's more realistic guidance, upgrading the stock to 'buy' recommendation. anticipating potential upside as the company stabilises post-demerger.

The company's stabilisation post-demerger is expected to lead to potential upside, despite potential volatility in earnings due to the merger.

Analysts highlight confidence in a gradual recovery, with the business-to-business and consumersegments possibly experiencing volatility in expectations and guidance over the next 12 to 18 months.

Investment outlook

There is optimism about Web Travel Group's prospects, with suggestions that the stock could reach $6 per share. The situation is described as a 'Humpty Dumpty effect,' with the company stabilising after the demerger.

Analysts believe management has addressed previous issues, and the stock's 13% rally indicates renewed investor confidence.

As Web Travel Group continues to navigate economic uncertainties, investors might consider adding this stock to their portfolios, especially given its potential for growth in the coming years.