It is not only passengers that National Express is struggling to win back on board — investors are still sceptical, too. Shares in the FTSE 250 constituent languish at roughly half their pre-pandemic level.
Wariness around near-term earnings is reflected in an enterprise value of only 5.7 times forecast earnings before interest, taxes, depreciation and amortisation for this year, far below the average multiple over the past decade.
The public transport operator needs to prove it can restore passenger levels to pre-pandemic levels, combat inflation and generate growth without sacrificing too much margin or hurting the balance sheet.
A bid for rival Stagecoach is designed to address the last of those three. National Express reckons its all-share offer can produce annual synergies of roughly £45
