Disclaimer: All the information provided here is not financial advice. The information presented is my opinion and may be completely inaccurate.
Wotif.com Holdings Limited is an Australia-based company, engaged in the provision of online travel booking services. Its services provide a range of choice for accommodation, flights, car rental, cruises, insurance, travel packages and tours.
Key financial ratios:
- Return on equity (2010): greater than 60%
- Debt to equity (2010): less than 1%
- Payout ratio: approximately 86%
Qualities that attract me:
- Internet companies have very low operating costs
- Zero debt (practically)
- Founder has large shareholding
- Strong market share
- Business model should be moderately resilient to a downturn, since accommodation providers will look channels like Wotif to get rooms booked.
Things that concern me:
- Lack of a competitive moat, market share isn’t as high as other online businesses (like SEEK.com)
- Strong Aussie dollar makes travelling in Australia expensive for OS travellers, also Aussies can travel more cheaply OS.
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