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1. Company Snapshot

1.a. Company Description

Hostelworld Group plc operates an online booking platform worldwide.The company offers software and data processing services that facilitate hostel, B&B, hotel, and other accommodation bookings.The company also provides business information consulting and marketing planning services; and marketing, and research and development services.


In addition, it is engaged in technology trading business.It operates approximately 1,100 hostels.Hostelworld Group plc was founded in 1999 and is based in Dublin, Ireland.

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1.b. Last Insights on HSW

Hostelworld Group PLC's recent performance was driven by strong net margin growth and effective cost management, as highlighted in its H1 2024 earnings release. The company achieved a significant improvement in net margin, despite a modest revenue increase, due to its successful social strategy. Additionally, the company's focus on budget travel, as seen in recent articles on European holiday planning, presents a promising opportunity for growth. Furthermore, the company's presence in the UK market, which has been experiencing challenges, may provide a unique investment opportunity for investors seeking to capitalize on undervalued stocks.

1.c. Company Highlights

2. Transcript Summary

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3. NewsRoom

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3 UK Penny Stocks With Market Caps Up To £200M

Nov -05

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3 UK Penny Stocks With Market Caps Over £100M To Consider

Oct -01

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Could The Market Be Wrong About Hostelworld Group plc (LON:HSW) Given Its Attractive Financial Prospects?

Sep -29

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Aug -19

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Hostelworld Group First Half 2025 Earnings: EPS: €0.009 (vs €0.02 in 1H 2024)

Aug -02

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UK Stocks Priced Below Estimated Fair Value In July 2025

Jul -18

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3 UK Stocks Estimated To Be Up To 42.8% Below Intrinsic Value

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UK Market Stocks Estimated Below Intrinsic Value In July 2025

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4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (8.98%)

6. Segments

Technology and Data Processing Fees

Expected Growth: 9%

Hostelworld Group plc's 9% growth in Technology and Data Processing Fees is driven by increasing online bookings, improved website functionality, and enhanced mobile optimization. Additionally, strategic partnerships, expanded payment options, and investments in data analytics have contributed to the growth, enabling the company to better understand customer behavior and tailor its services accordingly.

Advertising Revenue and Ancillary Services

Expected Growth: 7%

Hostelworld Group plc's 7% growth in Advertising Revenue and Ancillary Services is driven by increasing online bookings, improved mobile optimization, and targeted marketing campaigns. Additionally, the company's expansion into new markets, strategic partnerships, and enhanced user experience have contributed to the growth. Furthermore, the rise of experiential travel and growing demand for budget accommodations have also fueled the segment's growth.

7. Detailed Products

Hostel Bookings

Online booking platform for hostels and budget accommodations

Meininger Hotels

Design-led, centrally-located hotels offering a unique blend of hostel sociality and hotel comfort

Mediastay

Short-term rental platform for students, interns, and young professionals

Tipi

Mobile-first booking platform for hostels and budget accommodations

Hostelworld Insights

Data analytics and market research platform for the hostel industry

8. Hostelworld Group plc's Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for Hostelworld Group plc is medium due to the availability of alternative accommodation options such as Airbnb, hotels, and other online travel agencies.

Bargaining Power Of Customers

The bargaining power of customers is low due to the fragmented nature of the customer base and the lack of significant purchasing power.

Bargaining Power Of Suppliers

The bargaining power of suppliers is medium due to the dependence on a few large suppliers of accommodation options, but the company's scale and negotiating power mitigate this risk.

Threat Of New Entrants

The threat of new entrants is high due to the relatively low barriers to entry and the attractiveness of the online travel agency market.

Intensity Of Rivalry

The intensity of rivalry is high due to the competitive nature of the online travel agency market, with many established players and new entrants vying for market share.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 14.68%
Debt Cost 3.95%
Equity Weight 85.32%
Equity Cost 13.51%
WACC 12.11%
Leverage 17.21%

11. Quality Control: Hostelworld Group plc passed 3 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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Voyageurs du Monde

A-Score: 5.7/10

Value: 5.0

Growth: 8.6

Quality: 5.7

Yield: 2.5

Momentum: 6.5

Volatility: 6.0

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eDreams ODIGEO

A-Score: 4.9/10

Value: 5.4

Growth: 6.3

Quality: 6.1

Yield: 0.0

Momentum: 7.0

Volatility: 4.3

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On the Beach

A-Score: 4.9/10

Value: 4.4

Growth: 6.2

Quality: 7.6

Yield: 1.2

Momentum: 8.0

Volatility: 1.7

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Lastminute

A-Score: 4.6/10

Value: 7.0

Growth: 6.1

Quality: 6.3

Yield: 3.1

Momentum: 2.5

Volatility: 2.7

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Trainline

A-Score: 4.4/10

Value: 4.6

Growth: 7.9

Quality: 8.1

Yield: 0.0

Momentum: 2.5

Volatility: 3.3

1-Year Total Return ->

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Hostelworld

A-Score: 3.7/10

Value: 4.0

Growth: 5.1

Quality: 7.4

Yield: 0.6

Momentum: 3.0

Volatility: 2.3

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

1.25$

Current Price

1.25$

Potential

-0.00%

Expected Cash-Flows