Fund Manager Summary
The fund managers believe that the outlook for Webjet Group Ltd presents both opportunities and challenges. In their opinion, while the travel sector shows promise, they have opted to exit Webjet Group (WJL) post-demerger after reaching their valuation target. This decision reflects a strategic choice to redeploy capital elsewhere, indicating a cautious approach to current market conditions. Investors should note the fund managers' focus on maximizing returns while being mindful of sector dynamics.
Source: Trading View
Commentary From The Managers
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Tamim Funds Management
31 May 2025
$0.90
Summary
- Tamim Funds Management sold their investment in Webjet (ASX: WJL) following the company's FY25 results, which were affected by significant corporate activity.
- In March 2025, Tamim Funds Management noted WJL's market cap of $200m with $100m of net cash, and an EBITDA of $36m indicating a 3x EV/EBITDA valuation, deemed very attractive.
- Directors and Tamim Funds Management had been buying shares, highlighting the strong risk/reward opportunity at the time.
- Concerns remained regarding the uncertainty of management's new strategy and potential for an opportunistic takeover.
- In April and May, WJL attracted strategic investors, with Bain Capital acquiring 10.8% and Helloworld acquiring 15%.
- Bain Capital subsequently made a conditional bid of 80 cents, leading to WJL's stock price reaching 90 cents.
- Having acquired shares at an average price below 55 cents, Tamim Funds Management decided to take profits and exit the position.
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Please note: The completeness, accuracy or current status of the investments referenced are not guaranteed.
Commentary From The Managers
Tamim Funds Management
31 May 2025
$0.90
- Tamim Funds Management sold their investment in Webjet (ASX: WJL) following the company's FY25 results, which were affected by significant corporate activity.
- In March 2025, Tamim Funds Management noted WJL's market cap of $200m with $100m of net cash, and an EBITDA of $36m indicating a 3x EV/EBITDA valuation, deemed very attractive.
- Directors and Tamim Funds Management had been buying shares, highlighting the strong risk/reward opportunity at the time.
- Concerns remained regarding the uncertainty of management's new strategy and potential for an opportunistic takeover.
- In April and May, WJL attracted strategic investors, with Bain Capital acquiring 10.8% and Helloworld acquiring 15%.
- Bain Capital subsequently made a conditional bid of 80 cents, leading to WJL's stock price reaching 90 cents.
- Having acquired shares at an average price below 55 cents, Tamim Funds Management decided to take profits and exit the position.
Summary
Wilson Asset Management
31 May 2025
$0.90
- Webjet Group’s share price performed strongly following inline FY2025 results and a takeover offer.
- FY2025 results indicate that higher margin international flight bookings can offset an overall downturn in bookings across the group.
- Investor confidence was boosted by a non-binding takeover offer from BGH Capital at $0.80 per share.
- Webjet Group rejected the takeover offer, citing it as materially undervaluing the group.
- Market speculation suggests a higher offer may follow, contributing to a rise in Webjet Group’s share price.
- Wilson Asset Management continues to hold due to the company’s resiliency and strategic outlook.
Summary
Harvest Lane Asset Management
30 May 2025
$0.89
- Harvest Lane Asset Management continues to monitor the competitive landscape surrounding Webjet Group Ltd (WJL:ASX).
- The current situation involves Helloworld (HLO:ASX) and Gary Weiss vying for control or profit.
- While not a formal bidding war yet, Webjet is emerging as a significant contest for 2025.
- Historical context highlights Gary Weiss's long-standing presence in the investment industry.
- Weiss's past successes include notable takeover bids, such as for Woolworths in 1988 and Tyndall Australia in 1992.
- There is speculation regarding Weiss and BGH's ambitions for Webjet and whether they envision similar successes.
Summary
Tamim Funds Management
31 Mar 2025
$0.56
- Webjet (ASX: WJL) is a leading flight and hotel booking aggregator in the Australia & NZ markets.
- Recognized as one of the most iconic travel brands in Australia with 6 million customers and $1.5 billion in TTV sales annually.
- Recent demerger from Web Travel (WEB) has enabled a new management team to implement a focused strategy.
- The strategy includes a $20 million investment aimed at refreshing the brand and enhancing international booking conversion.
- Management's goal is to double TTV by 2030, with expectations of flat earnings next year and gradual growth from 2027.
- There is uncertainty regarding management's success, but the company may be vulnerable to an opportunistic takeover.
- WJL's market cap is $200 million with $100 million of net cash.
- The company generates $36 million of EBITDA and approximately $16 million of free cash flow.
- This results in a valuation of 3x EV/EBITDA, indicating the stock is incredibly cheap.
- Recent share purchases by directors and the fund indicate confidence in the company.
- Anticipation of capital management initiatives in the May results, with expectations of an 8% fully franked dividend from FY26.
- Tamim Funds Management believes the risk/reward opportunity here is among the most attractive on the ASX.
Summary
Endeavor Asset Management
30 Sept 2024
$1.00
- Endeavor Asset Management exited their position in Webjet Group (WJL) following a successful demerger.
- The decision was made after achieving valuation targets for the investment.
- Although the travel sector presents opportunities, Endeavor Asset Management chose to redeploy capital to other areas.
Summary
Naos Asset Management
30 Sept 2024
$1.00
- WJL was the final new investment made in Q1 FY25.
- WJL represents the B2C business of the formerly combined Webjet businesses.
- The combination previously included a B2B business segment.
- Further details on the WJL business can be found in the company updates on page 13.
- Naos Asset Management continues to hold this position due to these strategic considerations.
Summary
Please note: The completeness, accuracy or current status of the investments referenced are not guaranteed.
ANALYST INSIGHT
Equity Research Analyst
"With the travel sector seemingly on the rebound, exiting Webjet Group at our target valuation feels prudent. Yet, the allure of fresh opportunities beckons, suggesting that while potential exists, capital can often find more fertile ground elsewhere."
Last Updated: 31 May 2025
Query The Data
Frequently Asked Questions
Who is investing in Webjet Group Ltd (ASX:WJL)?
Fund managers including Endeavor Asset Management, Naos Asset Management, Wilson Asset Management, Harvest Lane Asset Management and Tamim Funds Management have invested in Webjet Group Ltd (ASX:WJL).
Why do fund managers invest in Webjet Group Ltd?
Fund managers have invested in Webjet Group Ltd due to its promising position in the travel sector and the achievement of valuation targets post-demerger. However, some have chosen to exit their investments to redeploy capital into other opportunities, indicating a strategic approach to portfolio management.
What happened to Webjet Group Ltd (ASX:WJL)?
There have been no recent updates from fund managers regarding Webjet Group Ltd although fund managers including Endeavor Asset Management, Naos Asset Management, Wilson Asset Management, Harvest Lane Asset Management and Tamim Funds Management have previously commented.