▶ 전체 게시글 텍스트
**Quick thesis on Jet2 (JET2.L):**
The stock trades on 5.5x P/E for a travel business that has net cash, double-digit growth prospects, the best competitive position and management team in the industry, and a large buyback.
The 5.5x P/E does not adjust for Jet2 having net cash of £610mm, equivalent to 30% of its market cap of £2.0bn.
For a long time I have hoped that Jet2 would supplement its strong growth in earnings by reinvesting some of those earnings into a buyback.
That finally happened over the last 18 months, with management surpassing my expectations by buying back 20%+ of the diluted share count.
The stock is down over the last 12 months, first because investors continue to be concerned about UK macro, then because of oil prices spiking.
But look at the strong results today despite the Strait of Hormuz crisis:
* FY26 in line with guidance
* Summer bookings +6.2%
* April-June load factor is in line with last year
* 87% hedged of fuel for the summer
* Important Gatwick expansion ahead of expectations
A key point is that Jet2 is a package holiday company, not a pure airline. Fuel is only about 10% of costs. At only 13% unhedged, even with jet fuel prices doubling a 1.3% price rise covers it. It is a lot easier to raise the price of a £1,000 holiday by £13 than a £100 flight by £13.
As airlines cancel flights, Jet2 gains market share.
During Covid, Jet2’s share went from 13% to 21%, which it has since held on to.
The company's key competitive advantage is that it has much higher customer retention than competitors. Over 2 years, 60% of customers rebook with Jet2 (even though it all holidays are UK to Europe, so if you want to go elsewhere you can't book with them). Their biggest competitor TUI is at 40% retention. easyJet launched a holidays business that is converting their flight-only customers to a package, but look how those customers will be treated this summer if they cancel \~15% of flights, as is likely if the Strait of Hormuz does not reopen soon.
I believe investors are too focused on this summer / the short term and that Jet2 will continue growing earnings at a high-single/low-double digit rate in most years, although it may be lower than that for the next 6-12 months.
Yes macro and sentiment is depressing, but is 5.5x P/E for a net cash, HSD/LDD grower, with excellent management, buying back stock the right price?
If you're interested in learn more, I've written consistently about Jet2 at Hidden Gems Investing. Here is a example (no paywall) for more background on the company (the article also includes a video of the standing ovation Buffett received at Berkshire Hathaway's meeting last year when he annouced his retirement!): [https://cwaller.substack.com/p/berkshire-hathaways-agm-2025?utm\_campaign=post-expanded-share&utm\_medium=web](https://cwaller.substack.com/p/berkshire-hathaways-agm-2025?utm_campaign=post-expanded-share&utm_medium=web)
Full dislosure: I am Long Jet2 and this is not investment advice or a recommendation. This is for informational purposes only.