Expedia gears up for crucial summer season with positive growth prospects

From Investing.com: 2024-07-05 07:23:02

Expedia (EXPE) is gearing up for a crucial summer season, with Q3 historically contributing 50% of its annual adjusted EBITDA. Revenue growth is expected to be 7%, slightly lower than previous quarters, attributed to Vrbo’s underperformance post-tech upgrades. However, B2B partnerships and Chinese market strength signal positive growth prospects.

Despite slowing revenue, Expedia shows rising EBITDA margins for four consecutive quarters, thanks to reduced tech spending and platform migration completion. While sales and marketing investments may impact margins, healthy free cash flow of $2 billion and EBITDA growth are expected to decrease leverage to 2.6x by year-end, the lowest since 2018.

Gimme Credit is optimistic about Expedia’s 7% annual growth projection and maintains a Buy recommendation. They highlight the 2031 notes trading at a +94 spread to the ten-year Treasury, indicating favorable market sentiment. animateWithDuration: rect 4s linear infinite;



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