Amadeus IT Group: A Digital Backbone For Airlines And Hotels To Hold

(6min)

Summary

  • Amadeus IT Group reported strong Q3 earnings with 12.6% revenue growth and double-digit growth across all segments, driven by higher volumes and pricing adjustments.
  • Despite the strong earnings, the stock is rated a hold due to its underperformance compared to the S&P 500 and its somewhat rich valuation against peers.
  • The stock has an 8% upside based on median EV/EBITDA multiple, with potential 22% upside next year driven by EBITDA and free cash flow growth.
  • I believe in the long-term potential of Amadeus IT Group as demand for IT and digital solutions in the travel and hospitality sectors continues to grow.
  • Looking for a helping hand in the market? Members of The Aerospace Forum get exclusive ideas and guidance to navigate any climate. Learn More »
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HAKINMHAN

In January, I covered Amadeus IT Group (OTCPK:AMADF) and rated the stock a hold and that seems to have been a good decision. The stock gained 3.9%, which does not compare favorably to the 22.8% return of the S&P 500. In this report, I

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This article was written by

Dhierin Bechai profile picture
17.48K Followers

Dhierin-Perkash Bechai is an aerospace, defense and airline analyst.

Dhierin runs the investing group The Aerospace Forum, whose goal is to discover investment opportunities in the aerospace, defense and airline industry. With a background in aerospace engineering, he provides analysis of a complex industry with significant growth prospects, and offers context to developments as they occur, describing how they might affect investment theses. His investing ideas are driven by data informed analysis. The investing group also provides direct access to data analytics monitors. Learn more.

Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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