WEB - Webjet

[Moonshine]

Feel i need to point this one out.

Been watching ever since October 2004 when she started to stir. Rode the Boom last year, peaked around $0.21, corrected along with the market back to $.10, and has now gathered all it's previous momentum to be touching $0.25 as we speak.

Each month an announcement comes out detailing 300%++ plus increase in revenue since the corresponding month last FY.

This is one tech stock that is going somewhere.

Not a holder yet, not sure why either, guess I am looking for a good weak spot to jump in..... but lo-and-behold... she just keeps on rising!!

Enjoy,

Moonshine

[Moonshine]

After a slight correction, WebJet is looking to close 15% higher today at an all time high of $0.30

The favourable sales reports keep coming in... July recorded another 350% increase in revenue from the corresponding period last year. Up from $3.4 million in July 04 to $10.9 million in July 05, and... July 05 was up 17% on June 05!

Can anyone point out any reasons NOT to get involved in this share??

Cheers,

Moonshine

[Moonshine]

Ok... this is getting out of hand.

One director is continually selling, meanwhine the SP is looking to close at another record high of 33c now! up another 3c today.

chart is HEALTHY.

Cheers,

Moonshine

[WASL]

As far as I can tell (I'm a new memeber & have not yet mastered the seaches) WEB last came into focus 22/7/05.

Worth a re-look. Finances are much much better and there is a rumor of a 5 cent capital return (may not be wise IMO).

cheers


WASL

[stevieb]

Must admit I have some of these as a speculative bet, the financials look pretty damn good to me, each announcement they announce record transactions, profits up, great cashflow.

They have first mover advantage in a market which will get significant growth and apparently very low costs. Watch this space I'd suggest, both fundamentally and on a TA perspective I think this one has some legs.

[WASL]

PE ratio for WEB looks better than Wotif. Only other contender is Flight centre but its a physical business rather than web based and therefore not realy comparable.

I admit to buying some today at $0.31.

Good luck & fasten your seatbelts.

ps check out the latest report from IRC (28-7-06). interesting & so thought the market today. Up 50% - nearly enough to get an ASX query.

WASL

[stevieb]

As far as the capital return, well it depends on what else they have planned. Currently they are a bit of a cash-cow and do need to do something with this money, the only question is what.

They really only have two choices, invest in the business (probably by an acquisition as the current business is running very well without injecting cost) or by returning the money.

While I'm not in the business myself it's certainly not obvious as to any other opportunities for them to buy but there may be overseas. To be beneficial to the company would want to be fairly cheap and have similarly low costs.

We'll see no doubt.

[stevieb]

Here is some comment from the Australian

quote:High-flyer Webjet ready to buy
Steve Creedy, Aviation writer
July 25, 2006
ONLINE travel service Webjet expects to build on a 330 per cent profit increase and a debt-free balance sheet to take advantage of "strategic opportunities" and increase its market presence over the next six to 12 months.
Unaudited figures issued yesterday showed that the value of Webjet's transactions increased by 122 per cent to $172.3 million for the year, as net profit before tax rose to between $3.2 million and $3.4 million, up from $700,000 last year. Operating cash flow was $4.1 million.

Webjet managing director David Clarke said he believed it was "more likely than not" that internet travel services would follow the consolidation seen in the bricks-and-mortar travel agencies, driven principally by the travel firm S8.

Mr Clarke believed that Webjet - which was profitable and cash-flow-positive, with no debt and more than $23 million in unencumbered cash - was well placed to take up any opportunity that presented itself.

"My guess is that, in response to the S8 initiatives, there will be another wave," he said.

"Within that environment, I think it is more likely than not that strategic opportunities will arise."

Webjet would not divert from its internet-only business plan.

It would also not be rushed into acquiring something because it was available at a cheap price.

"We will not, for example, buy a wholesaler," he said. "We will not buy a retailer in the traditional sense. We would not buy a call centre."

Emphasising that there were no targets in mind, he said it would be logical for Webjet to have a keen interest in internet hotel bookings. "But we're not going to rush into it," he said.

Asked about the surge in net profit, Mr Clarke said it reflected a substantial move of travel bookings towards the internet.

This was driven principally by the internet operations of domestic carriers, such as Qantas, Jetstar and Virgin Blue, and was part of a global trend.

The trend was not only evident within domestic travel, but simple international routes as well, such as the trans-Tasman and point-to-point destinations like London and Los Angeles.

"What is not yet happening to a major degree is very complex round-world itineraries," Mr Clarke said.

"I think that's the province of travel agents in the next 12 months or so. After that, who knows?"

[stevieb]

The fact that airlines are cutting commissions of course means that companies charges fees.

I'd suspect if you look around there are plenty examples of people paying more to get a better service.

Webjet provides the ability to see multiple airlines one one page and choose from this. Sure there are many people who will spend hours surfing the net looking at multiple web site to find the nest deal (I'm one of them). But there are also people who will say my time is valuable and for the sake of the fee (what is it $14) will want this added service.

With removal of commission I think you will find all Travel Agents moving to a fee based model, the question then is will people still want the added services Travel Agents provide.

I think that there will still be plenty who do. The question then is whther the online service providers or physical presences are better. I for one think that Travel Agents have for a long time provided an abysmall level of service, they are only open the times I cant get to see them and during the one time I can (lunchtime) there are huge queues.

Web based travel consolidators provide a one-stop shop that provides similar levels of service (yes there will always be people who want face to face) to Travel Agents but are available when you want it.

As to who would use these, I recently tried to help my sister find flights/accom/car rental for trip to Sunshine and Gold Coasts, provided all sorts of Web addreses. Her reply, "can't you just provide one site where I can find this all, I'd rather have this". And she was happy to pay a bit more.

I'd suggest Webjet's figures show this type of user is actually more common than the educated web users like us. In fact there is plenty of research which confirms this theory that most people like the web but really prefer consolidated sites than having to search.

[stevieb]

While I don't profess to understand why I believe that most customers are complacent customers, I can give so many examples where customers are prepared to pay more than is necessary for services, probably because they regard this as a service. In at least some of the examples people are paying way more than a $14 premium for goods at least as common as air tickets.

I certainly can't explain why but this doesn't mean they don't exist, they do an in virtually every product. Someone once said to me that "common sense is not that common" and it's so true.

I think assuming that people will act rationally (which for most of us means "like me") is a very dangerous prejudice IMO and we should actually be very careful about relying on this as an investment approach.

In relation to WEB (or any other company for that matter) this means we should judge what is happening rather than what we think should be happening. For WEB the volumes are increasing rapidly regardless of whether I personally would buy through them.