Trainline (TRN) 377p

Gain to date: 16%

At the beginning of February Shares said that Trainline (TRN) was ‘firmly on track for growth’ and investors should ‘buy into the momentum’. Fast forward a month or so and we still think so.

At the end of 2023, the shares enjoyed a resurgence, rising as much as 22% in one day after the UK Government said it would not go ahead with plans to create its own ‘Great British Railways’ ticket retailing website and app.

WHAT HAS HAPPENED SINCE WE SAID BUY?

On the 14 March, the online ticketing platform’s full year results beat guidance – the shares rose 12% intra-day hitting a new 12-month high of 366p.

Trainline has certainly been progressing nicely. The online ticketing platform reported a 22% increase in group net ticket sales to £5.3 billion in 2023 which was at the top end of the company’s already improved guidance range for growth between 17% to 22%.

The reason for the uplift was reduced strike action last year and the performance of its overseas operation, particularly in Spain.

Trainline’s market share continues to rise on key routes like Madrid-Barcelona which is now the company’s third most popular route across all countries, including the UK.

WHAT SHOULD INVESTORS DO NOW?

We remain positive. The company has clearly successfully tapped into the growing European market, having already acquired a 60% share of the UK online market.

International consumer net ticket sales increased by 14% over the past year, analysts at Shore Capital said the company’s ‘expansion within Europe and incoming international travel as key drivers for further value accretion’.

‘We see Trainline in a good position going into full year 2025,’ Shore Capital analysts added.

In September 2023 the company launched a £50 million share buyback programme, as of the end of February 2024, Trainline has completed just over half of the programme.

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