TUI's stock shows significant growth possibilities.
In a recent article published by BÖRSE ONLINE 44/24, the possibility of gold reaching new records is not the only investment opportunity worth considering. The travel agency TUI has been making waves, with its stock gaining over 40 percent since early August.
TUI's success story doesn't end there. The company's expected profit growth justifies double-digit stock prices, making it an attractive investment for many. As of now, TUI is one of the most shorted stocks, with almost 12 percent of its shares sold short. This, however, might not be a red flag, as TUI is currently benefiting from the insolvency of its competitor FTI, leading to better capacity utilization and enabling price increases.
The increased profitability expectations for TUI are driven by several factors. Higher net yields, improved load factor, cost control, and favorable expense timing have all contributed to TUI's cruise operations showing promising growth in 2025. The deployment of new ships with advanced technology, such as TUI Cruises’ new dual-fuel cruise ships, is another significant factor boosting profitability growth.
The company's own hotels and resorts, as well as the cruise business, are performing well. TUI aims to achieve average annual growth rates of 7 to 10 percent for operating profit in the medium term. The Lower Saxony-based company has a high cash flow and has confirmed management's forecast of increasing the adjusted EBIT by at least 25 percent compared to the previous year.
TUI's debt reduction plan, if successful, could lead to a decrease in financial costs. The tourism conglomerate has confirmed its aim to return to a credit rating that matches the pre-pandemic level of "BB" and "Ba" by S&P and Moody's. The price target for TUI's stock is raised to 12 euros, making it an appealing investment opportunity for those seeking growth.
The article recommends a speculative buy for TUI's stock, suggesting that the price target might not be the limit for this rising star. Winter bookings have increased by 10 percent for TUI, with a 7 percent increase across the entire company. Significant increases in net profit are expected for the recently completed fiscal year for TUI.
In conclusion, TUI's resilience and growth potential make it an interesting investment option for those looking to diversify their portfolio. With the travel industry on the rise and TUI's strategic moves, the future looks bright for this tourism giant.
TUI's resilience and growth potential have rendered it a noteworthy investment opportunity in the finance sector, with its strategic moves in the business realm and a positive outlook for the travel industry. The company's expected profit growth, reduced debt, and increased net profit make it an attractive choice for those wishing to invest in the stock market.
