Tag Archives: pcln

Expedia Gallops On Trivago; But Terror Attacks Hit Global Travel

Expedia ‘s ( EXPE ) $632 million bet on Trivago paid off again Thursday when the No. 2 online travel agency announced first-quarter results that topped estimates, due in part to the German subsidiary’s 48% year-over-year growth. Expedia stock bounded as much as 10% Friday before the closing the session up more than 8%, near 116. Shares of No. 1 rival Priceline ( PCLN ) rose 2%, the day after the company’s chief executive stepped down following an investigation into an at-work relationship . For the quarter, Expedia reported $1.9 billion in sales, up 39% year over year, and 9 cents adjusted earnings per share, swinging from a 3-cent per-share loss in the year-earlier quarter. Both measures topped analyst views for $1.8 billion revenue and a 6-cent per-share loss. Credit Suisse analyst Stephen Ju boosted his price target on Expedia stock to 134 from 130 noting the “clean, across-the-board beat.” Ju kept his neutral rating on Expedia stock as he awaits the effect of $3.9 billion acquisition HomeAway. In total, Expedia spent $6 billion acquiring companies in 2015, Benchmark analyst Daniel Kurnos wrote in a research report. Trivago — which Expedia acquired a majority share in, in 2012 — was a highlight. Trivago revenue jumped 48% to $176 million and accounted for the second-largest chunk of revenue behind the $1.54 billion, up 32%, achieved in Expedia’s core online travel agency segment. Egencia and HomeAway brought in $110 million and $142 million. “Trivago again achieved profitability, as aggressive spending drove 48% revenue growth while still achieving 25% contribution margins in Europe and 10% contribution margins across all geographies outside of Europe,” Kurnos wrote. International bookings came in at $6.6 billion, up 22% year over year, but about $500 million shy of the consensus, Kurnos wrote. Domestic bookings of $12.3 billion, up 38%, were in line with views. “We think most travel companies are being given a pass given the uncertain overall impact of the recent terror attacks,” Kurnos wrote. He has a 135 price target and buy rating on Expedia stock. Cowen analyst Kevin Kopelman expects a difficult second quarter as Expedia faces Easter-related headwinds and a difficult comparison. Of Expedia’s 37% total bookings growth in Q1, 24% was organic. For Q2, he forecasts 26% and 18%, respectively. But Q4 could signal a return to growth “as Expedia anniversaries both the Paris attacks and the initial rollout of TripAdvisor’s Instant Book partnership with Priceline,” he wrote in a report. Kopelman reiterated both a 135 price target and outperform rating on Expedia stock.

Expedia Rockets On Q1 Beat, Pulling No. 1 Rival Priceline Up

Expedia ( EXPE ) stock rocketed late Thursday after the No. 2 online travel firm topped Wall Street’s Q1 expectations on massive year-over-year boosts in room-night stays and gross bookings. In after-hours trading, Expedia stock was up more than 12%, rebounding from 0.7% decline in Thursday’s regular session, after No. 1 rival Priceline ( PCLN ), earlier in the day, announced its CEO had stepped down following an investigation into a relationship with an employee. Priceline stock closed down 2.7%, but buoyed somewhat late on Expedia’s coattails and was up 2% after hours. For Q1, Expedia reported $1.9 billion in sales, up 39% vs. the year-ago quarter, and 9 cents earnings per share minus items, swinging from a 3-cent per-share loss. Both metrics topped the consensus expectation of 28 analysts polled by Thomson Reuters for $1.8 billion and a 6-cent per-share loss. During Q1, room-night stays and gross bookings jumped by 42% and 32%, respectively, on a year-over-year basis, Expedia said. The company also completely migrated Orbitz.com and CheapTickets.com onto the Expedia platform. Expedia didn’t give Q2 guidance in its earnings release, but the consensus models $2.26 billion in sales and 98 cents EPS minus items, which would be up a respective 36% and 10% vs. the year-ago quarter.

Priceline CEO Resigns After Inappropriate Employee Relationship

Priceline ( PCLN ) CEO Darren Huston resigned Thursday after an internal investigation into an inappropriate relationship with an employee, but shares were down just a fraction in morning trading. The sudden resignation is effective immediately. Huston resigned without severance and forfeited his unvested stock options, Cowen analyst Kevin Kopelman noted in a research report. Kopelman still rates Priceline stock outperform. Chairman Jeffery Boyd was tapped to lead Priceline as the board searches for Huston’s successor. Boyd served as Priceline CEO from 2002 to 2013 and was succeeded by Huston in January 2014 after a lengthy, planned transition. Booking.com President and COO Gillian Tans was named CEO of that key Amsterdam-based Priceline subsidiary. Boyd initially joined Priceline in September 2011, leaving Microsoft ( MSFT ) to take the Booking.com CEO position. Huston’s resignation stemmed from an independent board investigation into a personal relationship with an employee not under his direct supervision, Priceline said in a statement. “The investigation determined that Mr. Huston had acted contrary to the company’s code of conduct and had engaged in activities inconsistent with the board’s expectations for executive conduct,” Priceline said. Huston acknowledged the conduct and expressed regret, the company said. Priceline stock has risen 14% since January 2014, when Huston took the helm. On the stock market today , Priceline stock was trading up fractionally near 1,348. Shares of rival Expedia ( EXPE ) were up 2.5% Thursday morning, ahead of the company’s Q1 earnings report, due out after the close. Priceline is slated to report Q1 earnings before the open on Wednesday and is expected to post $2.12 billion in sales and $9.65 earnings per share minus items, up 15% and 19%, respectively, vs. the year-earlier quarter. Kopelman foresees minimal disruption stemming from Huston’s exit, but he notes that Priceline could have opened itself up to potential litigation. “It is difficult to gauge this risk, given details of Huston’s misconduct were not disclosed,” Kopelman wrote. “However, Priceline has commented to media outlets that the misconduct did not involve the company’s financial reporting or controls.” Indeed, Priceline spokeswoman Leslie Cafferty told IBD via email: “This did not involve issues about the company’s financial statements, accounting or internal controls over financial reporting. This resignation was not related in any way to the company’s operational performance or financial condition.” RBC analyst Mark Mahaney reiterated his outperform rating on Priceline stock. Boyd’s return will provide “continuity, experience and leadership,” he wrote in a report. Tans’ role as Booking.com CEO is also a key positive, he said. Priceline’s fundamentals remain strong, Mahaney said. “These trends constitute one of the most robust growth and profitability profiles across the Internet sector,” he wrote.