Expedia (EXPE) AI Stock Analysis

• Market Cap: $20.83B
• Dividend Yield: 0.25%
• Average Volume (3M): 2.52M
• Price to Earnings (P/E): 18.1
• Beta (1Y): 1.63
• Revenue Growth: 6.64%
• EPS Growth: 69.85%
• Country: US
• Employees: 16,500
• Sector: Consumer Cyclical
• Sector Strength: 55
• Industry: Travel Services
• EPS (TTM): 9.05
• Shares Outstanding: 123,333,626
• 10 Day Avg. Volume: 2,855,472
• 30 Day Avg. Volume: 2,516,704
• PEG Ratio: 0.26
• Price to Book (P/B): N/A
• Price to Sales (P/S): 1.64
• Price to Cash Flow (P/CF): 28.30
• P/FCF Ratio: 28.30
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $203.35
• Price Target Upside: 36.00% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 27

Expedia shows strong financial performance with robust revenue and cash flow growth, significantly reduced leverage, and effective cost management. Technical analysis indicates a stable stock trend, while fair valuation suggests the stock is reasonably priced. Despite some concerns about softening travel demand and foreign exchange challenges noted in the earnings call, the overall outlook remains positive, leading to a moderately high score.

Positive Factors

Earnings

Expedia, Inc. delivered strong 4Q24 results, beating consensus estimates on both the top- and bottom-lines on durable travel demand.

Financial Performance

Reinstating quarterly dividends since the previous suspension is a positive signal for investors.

Growth Prospects

Maintaining a BUY rating, but raising the 12-month price target to $237, which reflects high growth prospects.

Negative Factors

Guidance

Guidance for 1Q25 and the full year, though slightly below estimates, appears better-than-feared given the stock's reaction after hours.

Macroeconomic Factors

Potential macroeconomic slowdown and recession could negatively impact travel service providers through reduced bookings and lower rates.

Market Dynamics

Preference for Booking Holdings over Expedia due to better profitability influenced by geographic market dynamics.

Expedia Business Overview & Revenue Model

Company Description

Expedia Group, Inc. operates as an online travel company in the United States and internationally. The company operates through Retail, B2B, and trivago segments. Its brand portfolio include Brand Expedia, a full-service online travel brand with localized websites; Hotels.com for marketing and distributing lodging accommodations; Vrbo, an online marketplace for the alternative accommodations; Orbitz, Travelocity, and CheapTickets travel websites; ebookers, an online EMEA travel agent for travelers an array of travel options; Hotwire, which offers travel booking services; CarRentals.com, an online car rental booking service; Classic Vacations, a luxury travel specialist; and Expedia Cruise, a provider of advice for travelers booking cruises. The company's brand portfolio also comprise Expedia Partner Solutions, a business-to-business brand that provides travel and non-travel vertical, which includes corporate travel management, airlines, travel agents, online retailers and financial institutions; and Egencia that provides corporate travel management services. In addition, its brand portfolio consists of Trivago, a hotel metasearch website, which send referrals to online travel companies and travel service providers from hotel metasearch websites; and Expedia Group Media solutions. Further, the company provides online travel services through its Wotif.com, lastminute.com.au, travel.com.au, Wotif.co.nz, and lastminute.co.nz brands; loyalty programs; hotel accommodations and alternative accommodations; and advertising and media services. It serves leisure and corporate travelers. The company was formerly known as Expedia, Inc. and changed its name to Expedia Group, Inc. in March 2018. Expedia Group, Inc. was founded in 1996 and is headquartered in Seattle, Washington.

How the Company Makes Money

Expedia generates revenue primarily through the facilitation of travel bookings across its various platforms, earning income via commissions and service fees. The company partners with a wide range of travel suppliers, including airlines, hotels, car rental companies, and tour operators, to offer an extensive selection of travel options. Key revenue streams include hotel and lodging bookings, which provide a significant portion of its earnings through the merchant model (where Expedia purchases rooms at a discount and sells them at a markup) and the agency model (where Expedia earns a commission on bookings). Additionally, the company earns revenue from advertising and media services, as well as from its Vrbo platform, which focuses on vacation rental properties. Strategic partnerships and collaborations with travel service providers and technology companies further enhance Expedia's offerings and market reach, contributing to its overall financial performance.

Expedia Financial Statement Overview

Summary

Expedia's financial health is strong with impressive revenue growth and profitability. The company has managed to reduce its leverage significantly, which is a positive sign for long-term stability. Cash flows are robust, supporting operational needs and growth investments. However, the low equity ratio and changes in EBITDA margins may require strategic focus to sustain future growth and financial flexibility.

Income Statement

Expedia's income statement reflects strong profitability and revenue growth. The gross profit margin remains high at approximately 89.5% for 2024, indicating effective cost management. The net profit margin has improved significantly from previous years, reaching 9.0% in 2024, up from 6.2% in 2023, highlighting enhanced operational efficiency. Revenue growth is robust, with a 6.6% increase from 2023 to 2024. However, EBITDA margin has decreased from 16.1% in 2023 to 11.0% in 2024, suggesting some pressure on earnings before interest, taxes, depreciation, and amortization.

Balance Sheet

The balance sheet shows a mixed picture. The debt-to-equity ratio has improved to 0.84 in 2024 from 4.28 in 2023, indicating reduced leverage. The equity ratio is low at 6.95%, reflecting a limited proportion of equity financing. Return on equity (ROE) has increased to 79.3% in 2024, showcasing strong profitability from shareholders' equity. However, the low equity base poses a potential risk of financial instability.

Cash Flow

Expedia's cash flow statement is strong, with significant operating cash flow of $3.085 billion in 2024, reflecting robust cash generation capacity. The free cash flow has increased by 67.3% from 2023 to 2024, indicating efficient capital expenditure management. The operating cash flow to net income ratio is high at 2.50, suggesting excellent conversion of income into cash. However, financing cash flow is negative, reflecting outflows that may require careful monitoring.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
13.69B	12.84B	11.67B	8.60B	5.20B
	Gross Profit
12.25B	11.27B	10.01B	7.08B	3.52B
	EBIT
1.32B	1.03B	864.00M	186.00M	-1.53B
	EBITDA
2.63B	2.07B	1.61B	1.13B	-1.90B
	Net Income Common Stockholders
1.23B	797.00M	352.00M	12.00M	-2.73B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
5.87B	5.69B	4.14B	4.31B	3.39B
	Total Assets
22.39B	21.64B	21.56B	21.55B	18.69B
	Total Debt
1.31B	6.57B	6.55B	8.81B	8.73B
	Net Debt
-4.27B	906.00M	2.46B	4.70B	5.37B
	Total Liabilities
19.59B	18.86B	17.83B	18.00B	14.66B
	Stockholders Equity
1.56B	1.53B	2.28B	2.06B	2.53B
Cash Flow		Free Cash Flow
3.08B	1.84B	2.78B	3.08B	-4.63B
	Operating Cash Flow
3.08B	2.69B	3.44B	3.75B	-3.83B
	Investing Cash Flow
-1.26B	-800.00M	-580.00M	-931.00M	-263.00M
	Financing Cash Flow
-1.75B	-2.10B	-2.62B	-973.00M	4.08B

Expedia Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 149.52
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For EXPE, the sentiment is Negative. The current price of 149.52 is below the 20-day moving average (MA) of 163.21, below the 50-day MA of 177.87, and below the 200-day MA of 160.51, indicating a bearish trend. The MACD of -4.20 indicates Negative momentum. The RSI at 40.06 is Neutral, neither overbought nor oversold. The STOCH value of 33.62 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for EXPE.

Expedia Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ABNB	76 Outperform	$76.50B	29.34	31.95%	―	11.95%	-44.02%
MMYT	75 Outperform	$10.76B	44.15	23.09%	―	28.51%	367.34%
EXPE	74 Outperform	$20.83B	18.07	79.84%	0.25%	6.64%	69.85%
BKNG	72 Outperform	$151.49B	26.73	-146.32%	0.78%	11.11%	47.03%
TCOM	67 Neutral	$36.34B	15.91	12.91%	0.51%	18.12%	69.44%
TRIP	61 Neutral	$1.77B	764.24	0.55%	―	2.63%	-58.77%
Sector *	59 Neutral	$11.76B	10.11	-0.70%	3.92%	1.27%	-16.30%

Expedia Corporate Events

Expedia Appoints Scott Schenkel as CFO

Expedia Group announced the appointment of Scott Schenkel as its Chief Financial Officer, effective after the company files its annual report for the fiscal year 2024. Schenkel, with over 30 years of financial leadership experience, is set to bring his expertise in e-commerce to strengthen Expedia’s position as a global travel leader. His compensation package includes a significant base salary, signing bonuses, equity incentives, and relocation assistance, reflecting the company’s commitment to securing top-tier executive talent to drive strategic goals.