B2B booking platform WEB plunged over 35% yesterday, and we looked at the move in yesterday’s “The Match Out” report. The reduction in revenue margins in FY25/FY26 for the second time since initial guidance of 7-7.5% was provided in the Mar-24 strategy day creates uncertainty regarding future earnings. Yesterday’s sell-off was aggressive, and a bounce wouldn’t surprise. Still, for now, we would rather wait to let the dust settle, and management finally demonstrate they’ve got a realistic as opposed to an optimistic handle on earnings moving forward – remember, downgrades often happen in threes.
- Over time, WEB should be able to play a similar AI game as BKNG, but for now, it needs to regain investors’ confidence.
NB MM has removed WEB from its Hitlist following two changes to guidance and a demerger = too hard.
MM is now neutral towards WEB short-term
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