Trainline PLC (LSE:TRN)’s rapid growth is set to slow, according to analysts at UBS, but there is still enough potential in Europe to keep the rail ticketing specialist moving forward.
UBS expects to see some slowing in the short term as Britain completes its recovery from Covid, with 8% growth assumed for this year against 23% in the year just ended.
France and Italy, too, might see a drop to around 10%, though the market in Spain " is the front runner and possible model for other countries as the national incumbent now accounts for only 60% of long-distance HSR passengers - increasing the need for ticket aggregation".
“We view large-scale competition in the €6bn HSR market in France, the expansion of competition on the Italian HSR and further competition on international routes as the key drivers of growth although this is unlikely until 2026 and beyond,” said UBS.
In the UK, a change of government will pose some risks, especially potential changes to commission structures and third-party retailers.
On the flipside, a Labour government could see labour relations improve and allow scope for fare reform to drive volume growth.
UBS has a price target of 385p, up from 350p, and a ‘neutral' rating.
Shares were up 2.2% at 364.8p at the time of writing.