Shares of British ticketing specialist Trainline (GB:TRN) were up nearly 10% as of writing, as the company upgraded its full-year guidance after delivering solid performance in the first half of Fiscal 2025 and experiencing a good start to the second half. This marked the second instance of the company raising its full-year outlook.
Don't Miss Our New Year's Offers:
- Discover the latest stocks recommended by top Wall Street analysts, all in one place with Analyst Top Stocks
- Make smarter investments with weekly expert stock picks from the Smart Investor Newsletter
Trainline had earlier boosted its outlook in September, with CEO Jody Ford attributing the performance to the company’s focus on innovation, which is attracting customers to digital ticketing.
Trainline Highlights Impressive H1 Numbers
For the first half of Fiscal 2025, Trainline reported a 14% year-over-year rise in net ticket sales to £3 billion and a 17% jump in revenue to £229 million. Notably, the company’s adjusted EBITDA (earnings before interest, tax, depreciation, and amortization) surged 44% to £82 million.
Additionally, the company generated operating free cash flow of £100 million in H1 FY25, while the leverage ratio came down by 50% to 0.2 times the adjusted LTM (last 12-month) EBITDA from 0.4 times in the comparable period of the previous year.
Trainline will provide further details on its H1 results on November 7.
Trainline’s Improved Guidance
Buoyed by the impressive first half and the solid start to the second half, Trainline increased its full-year revenue growth outlook to the range of 11% to 13% from the previous guidance at the top end of the 7% to 11% range. The company also boosted its net ticket sales growth estimate to the range of 12% to 14%, from the previous guidance at the top end of the 8% to 12% range.
Further, Trainline expects adjusted EBITDA as a percentage of net ticket sales to come in at about 2.6%, up from the prior forecast of exceeding 2.5%.
Overall, the company is enhancing its operating leverage, reflecting the impact of its increasing scale.
Is TRN a Good Stock to Buy?
Given Trainline’s robust financial performance, analysts have a Strong Buy consensus rating on TipRanks with seven Buys and two Hold recommendations. The average TRN stock price target of 425.02p implies 15.3% upside potential. Analysts might revise their price targets following today’s guidance upgrade.
