TRN: Buybacks And Digital Ticketing Shift Will Support Future Upside

Analysts have trimmed their blended price target for Trainline to around £3.00 per share from roughly £3.30, reflecting slightly lower fair value and profit margin assumptions that offset modestly stronger expected revenue growth.

Analyst Commentary

Recent research updates highlight a mixed but generally constructive stance on Trainline, with valuation expectations converging around a moderate premium to current trading levels and a clear divide between growth oriented and more cautious views.

Bullish analysts have nudged up their price targets over recent months, arguing that improving fundamentals and execution can support a higher multiple over time, even as they acknowledge near term volatility. Bearish analysts, meanwhile, point to a more balanced risk reward profile, emphasizing that much of the medium term growth story may already be reflected in the share price.

Bullish Takeaways

Upward target revisions earlier in the period, including moves from 325 GBp to 330 GBp and from 490 GBp to 500 GBp, signal confidence that revenue growth and operating leverage can drive further upside in earnings.
Supportive Buy ratings from some houses suggest that the long term shift toward digital ticketing and online distribution remains underappreciated in current valuation multiples.
Optimistic forecasts assume that management will execute effectively on product enhancements and geographic expansion, which could justify Trainline trading closer to high growth consumer tech peers.
Bullish analysts view the recent target trim to 300 GBp as a recalibration on margins rather than a thesis break, with the stock still seen as fairly valued to modestly undervalued on a medium term view.

Bearish Takeaways

The latest reduction of the blended target to around 300 GBp underscores concerns that profitability may lag prior expectations, limiting near term multiple expansion.
Neutral stances from large firms such as JPMorgan indicate that, at current levels, upside could be constrained by execution risks and potential cost pressures.
Bearish analysts worry that consensus may be too optimistic on the pace of demand normalization and ancillary revenue growth, raising the risk of earnings downgrades.
There is caution that competitive dynamics and regulatory developments in key markets could cap pricing power, which would weigh on both margin progression and overall valuation.

What's in the News

The Board of Directors authorized a new share buyback plan on September 11, 2025, signaling confidence in the balance sheet and long term prospects (Key Developments).
The company announced a £75 million share repurchase program to be executed in two tranches via Numis Securities and Morgan Stanley & Co. International, with shares to be cancelled or held in treasury and the program running for 12 months (Key Developments).
From March 13, 2025 to September 22, 2025, the company completed repurchases of 27,243,314 shares, representing 6.3% of share capital for £75 million under the first announced buyback (Key Developments).
From September 11, 2025 to October 31, 2025, the company completed a further repurchase of 5,502,727 shares, representing 1.34% of share capital for £15 million under the subsequent buyback (Key Developments).
The company reconfirmed fiscal 2026 guidance, maintaining expectations for group net ticket sales growth of between 6% and 9% year on year and group revenue growth of between 0% and 3% (Key Developments).

Valuation Changes

The fair value estimate has fallen modestly from 4.19x to 3.88x, indicating a slightly lower intrinsic valuation multiple being applied to Trainline.
The discount rate has edged up marginally from 9.07% to 9.08%, reflecting a slightly higher required return and marginally more conservative risk assumptions.
Revenue growth assumptions have risen slightly from 4.33% to 4.46%, implying a modestly stronger outlook for top line expansion.
The net profit margin has been reduced from 16.59% to 15.60%, pointing to a somewhat more cautious view on long term profitability.
The future P/E multiple has been trimmed from 24.49x to 22.35x, suggesting analysts now expect the shares to trade on a lower earnings multiple over the forecast horizon.

EU market expansion and competition boost passenger volume, increasing net ticket sales and revenue growth, especially in Spain and Italy.
Digitalization and ancillary services enhance operational efficiency and diversify income, projected to increase market share and revenue.
Future growth and revenue may be challenged by U.K. market disruptions, international sales issues, and paused marketing due to carrier competition in France.

Catalysts

About Trainline

Engages in the operation of an independent rail and coach travel platform that sells rail and coach tickets the United Kingdom and internationally.What are the underlying business or industry changes driving this perspective?

The expansion of the third-party ticket retail market in the EU and increased carrier competition, particularly in Spain and Italy, are expected to drive more passenger volume, translating to higher net ticket sales and revenue growth.
Digitalization and increased penetration of e-tickets in the U.K. are enhancing operational efficiencies and customer convenience, which can lead to increased market share in commuter rail, higher revenue, and better net margins.
Cost optimization strategies, such as reducing headcount and increasing operating leverage, are projected to enhance net margins and EBITDA margins, impacting bottom-line earnings positively.
The delay of Project Oval expansion potentially provides a tactical advantage by postponing competitive pressures in the U.K. market, helping maintain current revenue streams and market share.
Trainline's innovation in ancillary revenue streams, through offering additional services like hotels and travel insurance within the booking flow, is diversifying income sources and is expected to drive additional revenue growth.

Trainline Future Earnings and Revenue Growth

Assumptions

How have these above catalysts been quantified?

Analysts are assuming Trainline's revenue will grow by 4.3% annually over the next 3 years.
Analysts assume that profit margins will increase from 13.2% today to 16.6% in 3 years time.
Analysts expect earnings to reach £83.3 million (and earnings per share of £0.2) by about September 2028, up from £58.3 million today. However, there is some disagreement amongst the analysts with the more bearish ones expecting earnings as low as £74.0 million.
In order for the above numbers to justify the analysts price target, the company would need to trade at a PE ratio of 24.5x on those 2028 earnings, up from 18.3x today. This future PE is greater than the current PE for the GB Hospitality industry at 16.9x.
Analysts expect the number of shares outstanding to decline by 2.43% per year for the next 3 years.
To value all of this in today's terms, we will use a discount rate of 9.07%, as per the Simply Wall St company report.

Trainline Future Earnings Per Share Growth

Risks

What could happen that would invalidate this narrative?

The mention of an expected headwind from Transport for London's Project Oval expansion suggests potential future disruptions or challenges in the U.K. market, which could impact growth rates and revenue in the coming years.
There are industry-wide changes to the presentation of Google's search engine results that have subdued web sales in International Consumer, particularly for foreign travel, which could negatively affect international revenue and market share.
The decision to pause brand marketing in France due to insufficient carrier competition could lead to slowed growth and reduced revenue in that market until more competition enables more aggressive market positioning.
The reduction in net commissions in the U.K., agreed back in 2022, poses a risk to Trainline's margins as it directly impacts the profitability and revenue per ticket.
The uncertainty and timeline associated with regulatory changes and nationalization plans in the U.K., including consolidation in online ticketing platforms and ticket simplification, could impact the competitive landscape and future revenue streams.

Valuation

How have all the factors above been brought together to estimate a fair value?

The analysts have a consensus price target of £4.193 for Trainline based on their expectations of its future earnings growth, profit margins and other risk factors. However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of £5.8, and the most bearish reporting a price target of just £2.6.
In order for you to agree with the analyst's consensus, you'd need to believe that by 2028, revenues will be £502.0 million, earnings will come to £83.3 million, and it would be trading on a PE ratio of 24.5x, assuming you use a discount rate of 9.1%.
Given the current share price of £2.64, the analyst price target of £4.19 is 37.0% higher.
We always encourage you to reach your own conclusions though. So sense check these analyst numbers against your own assumptions and expectations based on your understanding of the business and what you believe is probable.

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Disclaimer

AnalystConsensusTarget is a tool utilizing a Large Language Model (LLM) that ingests data on consensus price targets, forecasted revenue and earnings figures, as well as the transcripts of earnings calls to produce qualitative analysis. The narratives produced by AnalystConsensusTarget are general in nature and are based solely on analyst data and publicly-available material published by the respective companies. These scenarios are not indicative of the company's future performance and are exploratory in nature. Simply Wall St has no position in the company(s) mentioned. Simply Wall St may provide the securities issuer or related entities with website advertising services for a fee, on an arm's length basis. These relationships have no impact on the way we conduct our business, the content we host, or how our content is served to users. The price targets and estimates used are consensus data, and do not constitute a recommendation to buy or sell any stock, and they do not take account of your objectives, or your financial situation. Note that AnalystConsensusTarget's analysis may not factor in the latest price-sensitive company announcements or qualitative material.

EU Expansion And Ancillary Services Will Drive Passenger Volumes And Diversify Income