Despite its strong form over the last couple of months, the S&P/ASX 200 Index (ASX: XJO) is still trading around 19% lower than its February highs.
While this is disappointing, this isn't a bad result compared to some shares on the index.
The Flight Centre Travel Group Ltd (ASX: FLT) share price has been a particularly poor performer this year. The travel agent's shares are down 69% from their 52-week high.
Why is the Flight Centre share price down 69% from its high?
Investors have been selling the travel agent's shares due to the impact the pandemic has had on the global travel market.
For example, during April the company's total transaction value (TTV) was tracking at approximately 5% to 10% of normal levels.
The good news, though, is that Flight Centre has been cutting its costs materially to combat this.
Last month management revealed that it was making strong progress towards reducing its global cost base down to its $65 million per month target. This should mean the company has more than enough liquidity to ride out the storm.
Is the Flight Centre share price a bargain buy?
While Flight Centre could prove to be a good long term investment, I wouldn't be in a rush to invest.
This is because, although I'm optimistic that domestic tourism will start its recovery in the coming months, it will take some time before the local travel market returns to normal.
Furthermore, it will take even longer for international tourism to return to normal levels.
In light of this, I think the company has a tough couple of years ahead of it. As such, I wouldn't expect its profits to return to previous levels any sooner than FY 2022, but possibly later.
For the same reasons, I'm not in a rush to buy Webjet Limited (ASX: WEB) shares either just yet.
