Webjet plunges on travel fears, downgrade
Webjet shares are having their worst day in two years following a rating downgrade from Morgan Stanley and fears over the coronavirus outbreak.
At 1306 AEDT, Webjet shares were down 11.3 per cent to a five-week low of $12.73.
Other travel-related shares were down as well, with Qantas falling 5.3 per cent and Flight Centre down 3.8 per cent as the death toll from the epidemic in China topped 100.
But Webjet was the worst decliner among ASX200 components on Tuesday, falling the most since Webjet lost 11.6 per cent of its value on November 22, 2017.
Morgan Stanley wrote that it expect Google’s new travel-booking features to eat into Webjet’s earnings just as it has Expedia and Tripadvisor’s.
The search giant rolled out its new travel features on January 8, merging features from its trips feature with its maps functionality.
Nearly two-third of Webjet’s traffic is from organic search, the Morgan Stanley report mentioned.
Webjet said in November it expected underlying earnings in fiscal 2020 of $157 million to $167 million, up 26 to 34 per cent over last year.