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Highlights
- FLT shares down over 22% in 2025
- Strong revenue growth despite high interest rates
- Trading below historical valuation multiples
Shares of Flight Centre Travel Group (ASX:FLT) have declined by 22.4% since the beginning of 2025, sparking renewed attention from market watchers. The company remains a key player in the travel industry and operates across more than 80 countries under various brand names.
Despite the decline in share price, the fundamentals of the business continue to evolve positively. Known for its widespread physical store presence, Flight Centre offers services ranging from leisure and corporate travel to hotel management and tour operations. This broad service spectrum allows it to cater to diverse customer needs in both the retail and business sectors.
What sets Flight Centre apart is its hybrid approach—combining online convenience with face-to-face service in physical locations. This hands-on model, coupled with exclusive travel deals, has helped maintain a loyal customer base.
In a broader context, the consumer discretionary sector—where Flight Centre belongs—has historically performed well under favourable economic conditions. The S&P/ASX200 Consumer Discretionary Index (ASX:XDJ) has delivered an annualised return of 13.88% over the past five years, outperforming the broader ASX200 index, which returned 8.90% annually in the same period.
Typically, companies in this sector thrive when interest rates are low, as consumers are more inclined to spend on non-essential goods and experiences like travel. However, despite the current high interest rate environment, Flight Centre has posted an impressive average revenue growth of 89.8% per year over the last three years—an indicator of strong operational momentum.
Dividend income is another aspect to consider. Among ASX dividend stocks, Flight Centre has delivered a current dividend yield of 3.1%, with a five-year average yield of 0.5%. This signals the company's improving financial strength and commitment to shareholder returns.
Valuation-wise, Flight Centre’s current price-to-sales ratio stands at 1.06x, which is significantly below its five-year average of 3.42x. This suggests the shares may be trading at a discount relative to historical norms. The drop could be attributed to either share price decline or revenue growth, with data showing that revenue has indeed been rising.
While no single metric should guide investment decisions, the current state of (ASX:FLT) presents a mix of growth potential and undervaluation that may merit further observation within the ASX200 landscape.
