Tag Archives: expe

Expedia Sees Currency As Less Of An Issue In 2016; Stock Up Late

Online travel agent Expedia ( EXPE ) late Wednesday posted Q4 earnings and revenue that missed Wall Street expectations, but executives said currency would be less of a factor this year and that they’ve seen no impact, at least not yet, from the steep drop in global stock markets at the start of this year. Shares were up after hours. Ahead of the earnings report, analysts were cautious on global macroeconomic concerns and competition with rivals Priceline ( PCLN ), TripAdvisor ( TRIP ) and privately held Airbnb. Expedia stock, though, was up 13% in after-hours trading, as executives seemed to assuage some fears in comments on the company’s earnings conference call with analysts. Shares of Priceline and TripAdvisor were each up 4% after hours. For Q4, Expedia said sales grew 29% to $1.7 billion, while earnings per share ex-items dropped 22% to 77 cents. The consensus estimate of analysts polled by Thomson Reuters called for $1.71 billion and $1 EPS ex items. In Q4, recently acquired Orbitz and HomeAway added $177 million and $20 million, respectively, to Expedia’s top line — which would have been $1.5 billion without them. Gross bookings rose 40%, in Q4, driven by a 28% increase from the company’s acquisitions. The strong dollar cost the company 5% of Q4 revenue growth and 9% of gross bookings growth, Expedia said. Expedia purchased HomeAway, which is focused on vacation rentals, in part because it’s a hedge against Airbnb, a firm that lets people rent out accommodations in their home to travelers. Private investors have valued Airbnb at over $20 billion — though as of late, mutual funds have been under fire for failing to properly value hot startups, such as ride-booking firm Uber and cloud storage provider Dropbox. Barclays analyst Paul Vogel said the Orbitz and HomeAway acquisitions would make it tough to estimate Expedia’s results. Expedia spent over $6 billion on those acquisitions. “There are a number of moving parts within Expedia that we believe have created an uncertain backdrop around forecasts and expectations,” Vogel wrote in a research note Tuesday. TripAdvisor is set to report Q4 earnings Thursday after the close, while Priceline is set to report earnings Feb. 17 before the open.

Recent Expedia Acquisitions Cloud Financials; Price Target Cut

Ahead of Expedia ‘s ( EXPE ) Q4 earnings out after the close Wednesday, Barclays on Tuesday lowered its price target for the online travel agency. Barclays analyst Paul Vogel dropped his price target to 120 from 150, citing a wide range of analyst estimates for the company as it integrates acquisitions such as Orbitz and HomeAway. “There are a number of moving parts within Expedia that we believe have created an uncertain backdrop around forecasts and expectations,” Vogel wrote in a research note Tuesday. Expedia revenue is expected to rise 26% to $1.71 billion in Q4 from $1.36 billion in Q4 2014, according to the consensus of analysts polled by Thomson Reuters. They see EPS minus items rising 16% to $1. Shares of the Seattle-based company were up a fraction in afternoon trading in the stock market today , near 91.Vogel rates Expedia stock overweight. HomeAway specializes in vacation rentals — known as alternative accommodations in industry jargon — that in part Expedia purchased as a hedge against the rapidly growing Airbnb, a firm that lets people rent out their home, a room in their home, or apartment to travelers. Analysts say rival online travel agency Priceline ( PCLN ), is well-hedged against alternative accommodations. In a research note last year, RBC analyst Mark Mahaney said Priceline’s inventory of 361,000 properties has risen by 80% in a year. Vogel says three issues could impact HomeAway’s revenue: 1. Complications surrounding integrating its financials with Expedia. 2. The change to online booking, which will have an impact on fee revenue and renewal rates. 3. Charging travelers a fee is critical to achieving the company’s projected earnings. In terms of integrating Orbitz into Expedia, Vogel is building only a “small amount of synergies” into his financial models based on executives’ commentary on the Q3 earnings call . Vogel, who also cut his Q4 earnings estimate, says the price-target cut was necessary given the “current market environment.”

Will Global Economic Worries Slow Online Travel Giant Expedia?

Online travel agency (OTA) Expedia ( EXPE ) is set to report earnings after the close on Wednesday — and analysts polled by Thomson Reuters expect double-digit percentage growth amid challenges. Expedia is set to grow revenue by 26% to $1.71 billion in Q4, compared with the year earlier quarter revenue of $1.36 billion, according to the consensus view. EPS minus items is expected to jump 16% to $1, from 86 cents, according to the poll of analysts. Expedia stock was down about 3.5% in afternoon trading on the stock market today . The market overall was down on Monday on worries over the global economy and oil back under $30 a barrel. Expedia has an IBD Composite Rating of 52, where 99 is the highest. Analysts have been expressing concern for the health of online travel companies as of late, citing the slowing global economy and increased competition. In a research note Monday, RBC Capital Markets analyst Mark Mahaney wrote that web traffic to Expedia’s various properties has been slightly up during the quarter, but attributed it to the fact that the firm acquired Orbitz in September and in December HomeAway , a large alternative accommodations platform. Those acquisitions also make the quarter more difficult for analysts to model, Mahaney says. U.S. online travel trends are slightly negative, he says, based on web traffic data from ComScore ( SCOR ) that show single-digit growth that may be slowing. But, Mahaney wrote that bookings growth is likely to remain strong and that the economics of Expedia’s per-unit costs remain favorable and growing. “Expedia has been an improving execution story for some time now, and has emerged as an excellent play on the secular growth of Online Travel and as a strong integrator of assets,” Mahaney wrote in the research note. Mahaney says that he expects executives to issue guidance on earnings before interest, taxes, depreciation and amortization (EBITDA) of low double-digit growth in its core online travel bookings business. But, the slowing global economy may change that guidance. Though Expedia and rival OTA Priceline ( PCLN ) acknowledge that startup Airbnb — which lets people rent their home, room in a home, or apartment to travelers via its website — is a threat to their businesses, Priceline executives have thus far dismissed it as “not material.” Both Expedia and Priceline are adding inventory that’s similar to Airbnb’s, which in industry jargon are “alternative accommodations.” TripAdvisor Stock At Lowest Since 2013 Down more than 4%, near 56 in afternoon trading Monday, TripAdvisor ( TRIP ) stock has taken a beating thus far in 2016. The company is set to report Q4 earnings on Thursday. Analysts polled by Thomson Reuters expect the top line to grow at a modest 3% to revenue of $298.5 million, up from $288 million in the year-earlier quarter. EPS ex-items is expected to fall 6% to 33 cents from 35 cents. Cowen analyst Kevin Kopelman wrote in a research note earlier this month that TripAdvisor would be the OTA he would be most concerned about in a bear market.