Hostelworld (HSW)

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Hostelworld HSW Logo

The world’s leading hostel-focused online booking platform.

24-Jan-2018 – 360.5p – £344.5m – PER 19.9

Trading Update For The 12 Months To End December 2017 – In-line.

Looking back on my notes – I still wonder who uses Hostelworld? I am sure it has an audience (that’s clear from the booking numbers), perhaps in the backpacker world. However, with AirBnB and Booking.com out there too, how long before those backpackers become users of the alternatives? Without continuing advertising spend, how will Hostelworld attract the next generation when AirBnB and Booking.com are poised to dominate? Sure, I may be wrong here. It remains my gut feel, I don’t like the long term outlook for Hostelworld. Nor am I particularly bowled over by the growth.

10-Apr-2018 – 366.5p – £350.3m – PER 19.3

Results For The 12 Months To End December 2017 – In-line. Market conditions, particularly in Europe, remain uncertain and while volume bookings are in line with expectations, weaker exchange rates, particularly for the US dollar, remain a significant headwind.

I still don’t believe in the long term outlook for Hostelworld and remain underwhelmed by the growth, considering the PER is almost 20.

21-Aug-2018 – 292p – £279.1m – PER 15.3

Interim Results For The 6 Months To End June 2018 – Bookings up 2% and with no monetary figures in the lengthy preamble we find… Revenues are down 9% to 42.6m Euro with PBT down from 10.3m Euro to 7.6m Euro (similar hit to EPS). The Interim Dividend is also down slightly (in-line with policy).

Last time I wrote “I still don’t believe in the long term outlook for Hostelworld and remain underwhelmed by the growth, considering the PER is almost 20”. Even on a PER of 15.3 now I still can’t get away from Neutral here.

29-Nov-2018 – 181p – £173.0m – PER 10.8

Strategy And Trading Update – With Revenue flat FY EBITDA is expected to be in-line – Chief Exec confident of new strategy and management team.

With hopes of becoming the “leading hotel focused online booking platform” I believe one of the obvious others will win the race here – Not sure it’s even worth a bid from one of them. But, anyway, the possibility of a bid is not usually a case for investment by me.

2-Apr-2019 – 183p – £175m – PER 12

Results For The 12 Months To End December 2018 – Bookings flat, Revenue down, Operating Profit down, EPS down, Dividend dow. This years trading started in-line.

I am as attracted here today as I was yesterday.

21-Aug-2019 – 162p – £155m – PER 10

Interim Results For The 6 Months To End June 2019 – Seems like Revenue down circa -10%, EBITDA, EPS and Dividend down circa -15% and expects FY EBITDA to be below2018.

I really don’t see this business succeeding in a race it is already losing, if I was to take any position here it would be a Short, except I suppose there is a possibility of a bid from one of the leaders in the race (or are they actually bothered?).

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