Expedia (EXPE) AI Stock Analysis

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Expedia

(NASDAQ:EXPE)

Rating:72Outperform

Price Target:

$229.00

▲(5.76% Upside)

Expedia's strong earnings call performance and bullish technical indicators are the most significant factors driving the score. Financial performance is stable but impacted by high leverage and declining cash flow growth. Valuation suggests the stock may be overvalued, which slightly tempers the overall score.

Positive Factors

Financial Performance

Expedia delivered better-than-expected results whereby Gross Bookings and EBITDA came in above consensus.

Market Share

Expedia's B2C business is back to growth and they have gained market share in accommodation and flights.

Shareholder Returns

Share repurchases of $627m was yet another sign of the company’s commitment to shareholder returns, with ~$2.3bn remaining on the stock buyback authorization.

Negative Factors

US Market Challenges

The US market continues to see pressure on inbound travel, with shorter booking windows and higher cancellation rates.

Vrbo Challenges

Hotels.com Gross Bookings declined as Vrbo experienced challenges with declining bookings due to lower Average Daily Rates, shorter booking windows, and higher cancellations.

Expedia (EXPE) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$26.24B

Dividend Yield0.55%

Average Volume (3M)1.91M

Price to Earnings (P/E)26.0

Beta (1Y)1.53

Revenue Growth5.69%

EPS Growth47.33%

CountryUS

Employees16,500

SectorConsumer Cyclical

Sector Strength80

IndustryTravel Services

Share Statistics

EPS (TTM)4.24

Shares Outstanding118,192,130

10 Day Avg. Volume1,484,958

30 Day Avg. Volume1,909,927

Financial Highlights & Ratios

PEG RatioN/A

Price to Book (P/B)N/A

Price to Sales (P/S)N/A

P/FCF RatioN/A

Enterprise Value/Market Cap0.81

Enterprise Value/Revenue1.52

Enterprise Value/Gross Profit1.70

Enterprise Value/Ebitda8.46

Forecast

1Y Price Target

$223.36

Price Target Upside3.16% Upside

Rating ConsensusModerate Buy

Number of Analyst Covering23

Expedia Business Overview & Revenue Model

Company DescriptionExpedia Group, Inc. is a leading online travel company that operates a diverse portfolio of travel brands, including Expedia.com, Hotels.com, Vrbo, and Trivago. The company provides a comprehensive range of travel services, including hotel bookings, vacation rentals, airline tickets, car rentals, and travel packages. With a global reach, Expedia connects travelers with various accommodations and experiences, leveraging technology and data analytics to enhance user experience and streamline the booking process.

How the Company Makes MoneyExpedia primarily generates revenue through a variety of channels, including transaction fees, commissions, and advertising revenue. The company's core revenue model involves earning commissions from hotel bookings, airline tickets, and car rentals made through its platforms. Additionally, Expedia offers vacation rental services through Vrbo, which also contributes to its commission-based earnings. The company has established significant partnerships with airlines, hotels, and travel service providers, which enhance its inventory and offerings. Moreover, Expedia earns advertising revenue from travel-related businesses that utilize its sites for promoting their services. The combination of these revenue streams, along with a focus on expanding its brand presence and enhancing user engagement, drives Expedia's financial performance.

Expedia Key Performance Indicators (KPIs)

Any

Adjusted EBITDA Breakdown

Adjusted EBITDA Breakdown
Analyzes earnings before interest, taxes, depreciation, and amortization, adjusted for specific items, to assess operational profitability and cash flow potential.

Chart InsightsExpedia's B2C segment shows a cyclical pattern with strong Q3 performances, while B2B consistently grows, reflecting strategic focus. Despite macroeconomic pressures and soft US travel demand impacting the consumer business, B2B and advertising segments are thriving, with 14% and 20% growth respectively. The company's disciplined cost management and AI-driven initiatives are bolstering EBITDA, which increased by 16%. However, challenges like declining consumer sentiment and Hotels.com's negative performance indicate potential risks. Expedia's strategic focus on AI and loyalty programs could mitigate these challenges and drive future growth.

Data provided by:

Main Street Data

Expedia Earnings Call Summary

Earnings Call Date:Aug 07, 2025

(Q2-2025)

% Change Since: |

Next Earnings Date:Oct 30, 2025

Earnings Call Sentiment Positive

The earnings call highlighted significant growth in international markets, B2B, and advertising segments, along with successful strategic partnerships and AI advancements enhancing conversion rates. However, the muted U.S. travel market, declines in Vrbo and Hotels.com bookings, and shortened booking windows presented challenges.

Q2-2025 Updates

Positive Updates

Exceeded Top and Bottom Line Expectations

Gross bookings grew by 5%, revenue increased by 6%, and adjusted EBITDA margins expanded by nearly 2 points, surpassing both top and bottom line expectations.

B2B and Advertising Strong Performance

B2B bookings grew 17%, marking the 16th consecutive quarter of double-digit growth, and advertising revenue increased by 19% with a record number of active partners.

International Growth

Room nights grew mid-teens in the rest of the world and nearly 20% in Asia. International revenue growth was up 13%.

AI Enhancements Driving Conversion

AI filters improved traveler experience and increased conversion rates. Insurance products personalized coverage, resulting in the highest insurance attach rates ever.

Successful Strategic Partnerships

Partnership with Southwest Airlines contributed to outpacing total U.S. air ticket sales, and partnerships with Premier Inn and Ryanair strengthened the European value proposition.

Record Attach Rates for Brand Expedia

Brand Expedia was the largest and fastest-growing consumer brand, with multi-item attach rates at their highest level since the pandemic.

Improved Marketing Leverage

For the past 3 quarters, the company achieved flat or leveraged direct marketing spend in the consumer business.

Negative Updates

Soft U.S. Travel Market

The U.S. travel market was muted, with softer consumer spending and travel environment, particularly impacting inbound travel.

Vrbo Bookings Decline

Vrbo bookings declined due to lower daily rates, shorter length of stay, and higher cancellations in a softer environment.

Hotels.com Bookings Decline

Hotels.com bookings declined slightly, although room nights accelerated from the first quarter.

Shortened Booking Windows

The U.S. travel market experienced shorter booking windows and higher cancellations.

Company Guidance

During the Expedia Group Q2 2025 Financial Results Teleconference, the company reported a 5% increase in gross bookings and a 6% rise in revenue, with adjusted EBITDA margins expanding by nearly 2 points. Brand Expedia was highlighted as the largest and fastest-growing consumer brand, while the B2B segment saw a 17% growth in bookings. Advertising revenue increased by 19%, driven by a record number of active partners. The company observed a 7% growth in booked room nights, with a notable 20% increase in Asia. Expedia raised its annual guidance due to strong first-half performance and current travel demand trends, expecting full-year gross bookings and revenue growth of 3% to 5%, with adjusted EBITDA margin expansion of a full point. The company emphasized strategic priorities, including delivering value to travelers, investing in growth areas like B2B and advertising, and driving operational efficiencies.

Expedia Financial Statement Overview

Summary

Expedia shows strong profitability and operational efficiency with consistent revenue and profit margins. However, high leverage poses a potential risk, and declining free cash flow growth could impact future liquidity. The company is financially stable but should focus on reducing debt levels to mitigate risk.

Income Statement

Positive

Expedia's income statement shows strong gross profit margins consistently above 85%, indicating effective cost management. The TTM net profit margin is healthy at 7.94%, although it has decreased from the previous year. Revenue growth is modest at 1.65% TTM, suggesting a stable but slow growth trajectory. The EBIT and EBITDA margins are solid, reflecting good operational efficiency.

Balance Sheet

Neutral

The balance sheet reveals a high debt-to-equity ratio of 7.75 TTM, indicating significant leverage which could pose financial risk. However, the return on equity is robust at 93% TTM, suggesting effective use of equity to generate profits. The equity ratio is low, highlighting reliance on debt financing.

Cash Flow

Positive

Cash flow analysis shows a decline in free cash flow growth by 13.09% TTM, which is concerning. However, the operating cash flow to net income ratio is positive, indicating that the company generates sufficient cash from operations relative to its net income. The free cash flow to net income ratio is strong, suggesting good cash conversion.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	14.02B	13.69B	12.84B	11.67B	8.60B	5.20B
Gross Profit	12.56B	12.25B	11.27B	10.01B	7.08B	3.52B
EBITDA	2.52B	2.63B	2.07B	1.61B	1.13B	-1.90B
Net Income	1.11B	1.23B	797.00M	352.00M	12.00M	-2.61B
Balance Sheet
Total Assets	26.98B	22.39B	21.64B	21.56B	21.55B	18.69B
Cash, Cash Equivalents and Short-Term Investments	6.67B	4.48B	4.25B	4.14B	4.31B	3.39B
Total Debt	6.48B	6.53B	6.57B	6.55B	8.81B	8.73B
Total Liabilities	24.89B	19.59B	18.86B	17.83B	18.00B	14.66B
Stockholders Equity	836.00M	1.56B	1.53B	2.28B	2.06B	2.53B
Cash Flow
Free Cash Flow	2.56B	2.33B	1.84B	2.78B	3.08B	-4.63B
Operating Cash Flow	2.78B	3.08B	2.69B	3.44B	3.75B	-3.83B
Investing Cash Flow	-1.03B	-1.26B	-800.00M	-580.00M	-931.00M	-263.00M
Financing Cash Flow	-1.78B	-1.75B	-2.10B	-2.62B	-973.00M	4.08B

Expedia Technical Analysis

Technical Analysis Sentiment

Positive

Last Price216.52

Price Trends

50DMA

190.84

Positive

100DMA

176.82

Positive

200DMA

178.19

Positive

Market Momentum

MACD

7.32

Positive

RSI

69.45

Neutral

STOCH

75.92

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For EXPE, the sentiment is Positive. The current price of 216.52 is above the 20-day moving average (MA) of 207.38, above the 50-day MA of 190.84, and above the 200-day MA of 178.19, indicating a bullish trend. The MACD of 7.32 indicates Positive momentum. The RSI at 69.45 is Neutral, neither overbought nor oversold. The STOCH value of 75.92 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for EXPE.

Expedia Risk Analysis

Expedia disclosed 15 risk factors in its most recent earnings report. Expedia reported the most risks in the "Ability to Sell" category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

Expedia Peers Comparison

Overall Rating

UnderperformOutperform

Sector (61)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ABNB	76 Outperform	$79.29B	30.13	33.26%	―	10.23%	-44.56%
TCOM	73 Outperform	$48.61B	19.80	12.94%	0.38%	17.73%	27.95%
EXPE	72 Outperform	$26.24B	25.96	129.04%	0.55%	5.69%	47.33%
BKNG	69 Neutral	$178.43B	38.29	-146.32%	0.67%	11.72%	0.51%
MMYT	66 Neutral	$9.10B	113.48	22.38%	―	18.13%	-55.21%
TRIP	66 Neutral	$1.94B	36.11	8.76%	―	3.03%	187.03%
Sector *	61 Neutral	$17.96B	13.14	-5.29%	3.00%	1.25%	-13.95%

* Consumer Cyclical Sector Average

Performance Comparison

EXPE

Expedia

216.52

82.19

61.19%

TCOM

Trip.com Group Sponsored ADR

72.99

25.49

53.66%

MMYT

Makemytrip

100.09

6.33

6.75%

BKNG

Booking Holdings

5,585.86

1,833.15

48.85%

TRIP

TripAdvisor

17.96

4.03

28.93%

ABNB

Airbnb

125.37

9.21

7.93%

Expedia Corporate Events

Stock BuybackDividendsBusiness Operations and StrategyFinancial Disclosures

Expedia Announces Quarterly Dividend Amid Strong Q2 Results

Positive

Aug 7, 2025

On August 7, 2025, Expedia Group announced a quarterly cash dividend of $0.40 per share, payable on September 18, 2025. The company reported its second quarter 2025 financial results, highlighting a 5% growth in bookings and a 6% increase in revenue year-over-year. Despite a decrease in GAAP net income by 14%, adjusted net income grew by 16%, and adjusted EBITDA increased by 16% with margin expansion. Expedia repurchased $627 million worth of shares in the quarter and increased its full-year guidance, indicating strong performance driven by growth in B2B and advertising sectors.

Executive/Board ChangesShareholder Meetings

Expedia Stockholders Approve Key Proposals at Annual Meeting

Neutral

Jun 6, 2025

On June 3, 2025, Expedia Group, Inc. held its 2025 Annual Meeting of Stockholders where three key proposals were voted on. Stockholders elected 11 directors to the Board, approved the compensation of the company’s named executive officers, and ratified the appointment of Ernst & Young LLP as the independent registered public accounting firm for the fiscal year ending December 31, 2025. These decisions reflect the company’s ongoing governance and operational strategies, potentially influencing its market positioning and stakeholder relations.

Glossary

BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Aug 19, 2025