Stifel has reiterated its ‘buy’ rating on Trainline PLC (LSE:TRN), saying concerns around pay-as-you-go (PAYG) ticketing are overdone and unlikely to derail the group’s longer-term growth story.
The broker acknowledges that PAYG systems, which let passengers tap in and out without pre-booking, could affect Trainline’s share of on-the-day bookings, which account for 69% of UK transactions.
But Stifel estimates that by 2028, only about 7% of the group’s total ticket sales might be at risk. Even in a more extreme scenario, where PAYG adoption mirrors London’s high contactless usage, the impact might only reach 15% to 20% of sales, and not all at once.
Instead, Stifel expects any shift to unfold gradually across the 2030s, acting as a headwind for UK growth rather than a fundamental threat. The broker also believes growing international sales and increased digital adoption in the UK will help offset any UK-specific pressure.
After recent results, Stifel has trimmed revenue and profit forecasts slightly for 2026 and 2027, but calls the changes marginal. It sees the stock as attractively valued at 13.8 times earnings, excluding cash, and maintains its positive stance.
The shares were off 1% at 277.8p.