Fund Manager Summary on Webjet Group Ltd (ASX:WJL)
Webjet Group Ltd (ASX: WJL) has garnered investor attention amid recent takeover activity and its resilient performance despite broader booking downturns. Fund managers note that higher margin international flight bookings have positively impacted earnings, with the company rejecting a takeover offer from BGH Capital seen as undervaluing its potential. Key opportunities lie in the company's strategic plan to double total transaction value (TTV) by 2030, backed by a $20 million investment to revitalize its brand and strategy. However, risks include potential undervaluation attracting opportunistic bids and uncertain execution of management's new initiatives. The presence of strategic investors like Bain Capital and Helloworld suggests increased confidence in Webjet's future, positioning it attractively within the ASX despite recent market pressures.
Commentary From The Managers
There are 6 insights from 5 fund managers regarding their investment in Webjet Group Ltd (ASX:WJL) available on Thesis Tracker.
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Updates are made available to members within 12 hours of being released. The completeness, accuracy or current status of the investments referenced are not guaranteed.
Commentary From The Managers
Wilson Asset Management
31 May 2025
$0.90
Summary
- 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.
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.
Harvest Lane Asset Management
30 May 2025
$0.89
Summary
- 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.
Tamim Funds Management
31 Mar 2025
$0.56
Summary
- 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.
Endeavor Asset Management
30 Sept 2024
$1.00
Summary
- 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.
Naos Asset Management
30 Sept 2024
$1.00
Summary
- 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.
The completeness, accuracy or current status of the investments referenced are not guaranteed.
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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 invest in Webjet Group Ltd due to its strong growth prospects in the travel sector, particularly in international flight bookings. The company's recent FY2025 results showed resilience, with strategic investments aimed at improving conversion rates and tripling total transaction value by 2030. Additionally, the recent non-binding takeover offer from BGH Capital, perceived as undervaluing the company, has heightened investor interest. Coupled with a favorable risk/reward profile and potential for dividends, Webjet represents an attractive opportunity in the current market.
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.
What is the short interest in Webjet Group Ltd (ASX:WJL)?
The short interest in Webjet Group Ltd (ASX:WJL) is 0.15% which makes it the 373rd most shorted stock on the ASX. Of the 392.5M shares that Webjet Group Ltd has on issue, 590.3K have been sold short.
What does Webjet Group Ltd (ASX:WJL) do?
Webjet Group Ltd. engages in the provision of online travel agency services. Its brands include Webjet OTA, Airport Rentals, Motorhome Republic, and Trip Ninja. The company was founded in 1998 and is headquartered in Melbourne, Australia.