$DTG.L – Dart Group – good half-year report

Airline, holiday, and logistics operator $DTG .L (Dart Group), issued its half-year report today (http://goo.gl/EF458R), sending its shares up 8.2% to 436p at the close. Revenues were up 21% over the comparable period. Basic EPS was up 14%. The interim dividend is up 53%, showing confidence in the direction that the company is going. Load factors were slightly lower, but they did have increased seat capacity. They state:

Whilst we recognise the likely upward pressures on market pricing following the weakening of Sterling post Brexit; for the long term, we have confidence in the resilience of our Leisure Travel business and are encouraged by the increasing proportion of customers taking our great value, real package holidays. With winter 2016/17 Leisure Travel bookings continuing to perform in line with expectations, the Board is currently optimistic that market expectations for the full year will be slightly exceeded.

The shares have been a disappointment over the last year, with the share price down 4.8%, whilst the Footsie is up 11.0%. However, Stockopedia reports that DTG stands on a PE of 10.5, which is cheap considering that it is still very much a growth company. Perhaps fears of its cyclical nature and potential vulnerability to economic events have held the share price down. Given the positive statement today, and the market reaction to the results, I think a re-rating of its shares are in order.

I have been a holder of DTG for a few years now.


About mcturra2000

Computer programmer living in Scotland.
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