Trainline 

(TRN) 374p

Gain to date: 15.1%Market cap: £1.5 billion

It is barely two months since the rail ticketing app Trainline (TRN) said it was raising its full-year 2025 guidance and it has now repeated the trick.

We flagged the stock’s appeal in early February because of the continuing potential in its domestic market and, in particular, its ability to tap into European growth.

WHAT HAPPENED SINCE WE LAST SAID BUY?

Since we last updated on this idea in September the stock has hit a new three-month high although it is still below its 52-week high of 393.8p set on 20 March 2024.

For the 12 months to 28 February 2025 the company now expects net ticket sales year-on-year growth of between 12% and 14% (previous guidance was for growth at the top end of 8% to 12% range).

Trainline cited robust growth, continued momentum and a benefit from ‘operating leverage’ (revenue rising faster than costs) for the upgrade as it scales up the business.

The company is set to report first-half results in full on 7 November when investors will get more colour on the performance of the business.

WHAT SHOULD INVESTORS DO NOW?

We remain upbeat about Trainline. The company is making progress in Spain, Italy and is the most downloaded rail app in Europe. In the UK, Trainline has already acquired a 60% share of the online market.

With the new Labour government confirming that it has no immediate plans for a state-controlled ticketing app, a major threat looming over the investment case has eased.

Shore Capital analyst Katie Cousins says: ‘We continue to see Trainline as a dominant player within the UK rail network, set to benefit from the increasing digitalisation demand from consumers.

‘Beyond this, we believe the international opportunity, which is building, is not factored into the current group multiple of around 10 times EV/EBITDA (enterprise value to earnings before interest, tax, depreciation and amortisation), a discount to wider UK platform peers.’ 

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