Expedia Group Outshines Rivals with Impressive Stock Performance
Market Success and Analysts’ Optimism Fuel Growth
Seattle-based Expedia Group, Inc. (EXPE) is a key player in the online travel industry, catering to leisure and business travelers alike. With a market cap of $20.8 billion, the company offers an array of services through its well-known brands, such as Expedia, Hotels.com, and Vrbo, ensuring memorable trips for its users.
In the past year, Expedia’s stock has significantly outperformed the broader market. It surged by 42.9%, while the S&P 500 Index ($SPX) recorded a 31.1% increase during the same period. Despite a strong start to 2024 with a 6.1% rise, the SPX gained 19.8% year to date, showcasing a more remarkable performance overall.
When compared to the Invesco Dynamic Leisure and Entertainment ETF (PEJ), which has climbed approximately 30.7% over the last year, EXPE’s performance stands out. However, the ETF outpaced Expedia with an 18% increase year to date.
On October 17, shares of EXPE surged over 4% after the Financial Times reported that Uber Technologies, Inc. (UBER) was exploring a potential acquisition of Expedia.
In its Q2 earnings report released on August 8, EXPE’s revenue reached $3.6 billion, exceeding expectations of $3.5 billion, and its adjusted earnings per share (EPS) rose by 21.5% year over year, reaching $3.51. This performance was bolstered by increases in booked room nights and gross bookings.
Looking ahead to the current fiscal year that ends in December, analysts project an EPS growth of 20.8%, bringing it to $8.99 on a diluted basis. Additionally, Expedia has consistently surpassed earnings expectations in the previous four quarters, indicative of its strong financial health.
Among the 31 analysts monitoring EXPE, there is a consensus rating of “Moderate Buy,” based on eight “Strong Buy” ratings, one “Moderate Buy,” and 22 “Holds.”
This outlook is less optimistic than two months ago when nine analysts recommended a “Strong Buy.” On October 29, DBS analyst Amanda Tan confirmed a “Hold” rating for EXPE, setting a price target of $135.
Currently trading above its average price target of $150.72, the Street’s highest target of $200 suggests there is still a potential upside of 24.1% for investors.
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On the date of publication, Neha Panjwani did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article are solely for informational purposes. For more information, please see the Barchart Disclosure Policy here.
The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.
