WEBULL

Travel + Leisure (TNL): Valuation Check After Quarterly Earnings Beat and 16% Share Price Jump

Simply Wall St · 2d ago

Travel + Leisure (TNL) has been on investors’ radar after quarterly results beat expectations on both revenue and adjusted operating income, helping lift the stock roughly 16% over the past month.

See our latest analysis for Travel + Leisure.

That upbeat earnings surprise has slotted neatly into a strong year for Travel + Leisure, with a roughly 44% year to date share price return and a robust three year total shareholder return above 130%. This signals that investors see momentum building as execution improves and financing costs ease following the recent term loan repricing.

If this kind of momentum has your attention, it could be a good time to explore fast growing stocks with high insider ownership as another way to spot compelling stories early.

With shares already near analyst targets and screens flagging the stock as undervalued on intrinsic metrics, the key question now is whether TNL still offers a genuine buying opportunity or if markets are already pricing in the next leg of growth.

Most Popular Narrative: 3.6% Undervalued

With Travel + Leisure last closing at $71.69 against a most popular narrative fair value of $74.33, the storyline leans toward continued upside from here.

The strong and growing pipeline of predictable, recurring revenue from owner upgrades, management fees, and financing activity (with 75% of revenue recurring), along with a $20 billion ten year revenue pipeline, underpins dependable free cash flow generation and earnings stability for future periods.

Read the complete narrative.

Curious how steady growth, expanding margins and a restrained future earnings multiple can still support a higher value than today’s price, even after the rally? The full narrative lays out the cash flow roadmap and the valuation math behind it, step by step, in a way headline multiples alone do not capture.

Result: Fair Value of $74.33 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, persistent headwinds in Travel and Membership, along with heavy reliance on US vacation ownership, could derail growth if competitive and demographic pressures intensify.

Find out about the key risks to this Travel + Leisure narrative.

Build Your Own Travel + Leisure Narrative

If you see the story unfolding differently or would rather dig into the numbers yourself, you can build a complete narrative in minutes using Do it your way.

A great starting point for your Travel + Leisure research is our analysis highlighting 4 key rewards and 3 important warning signs that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.