Expedia (EXPE) Stock Down, But Piper Jaffray Remains Bullish

Piper Jaffray analysts believe Expedia (EXPE) will perform better than its peers when the company's earnings are released next Thursday.
By Annie Palmer ,

NEW YORK (TheStreet) -- Shares of Expedia (EXPE) - Get Report are down by 0.35% to $116.78 on Thursday morning, despite Piper Jaffray analysts saying they believe the online travel agent will perform better than its peers, when it reports fiscal 2016 second quarter results next Thursday.

The firm reiterated its "overweight" rating on Expedia, Priceline (PCLN) and TripAdvisor (TRIP), Barron's reports. 

Piper Jaffray added that Priceline is likely to forecast "unusually conservative" results after Brexit, hampering its 2016 second quarter report. Overall, the firm said they feel the Brexit impact will be slow on travel in the next few years, with consumer confidence and spending patterns staying relatively stable. 

Expedia, on the other hand, has less exposure to falling European room revenue trends, the firm noted.

"Expedia appears to have flexibility in marketing spend which, along with potential outsized benefit from HomeAway booking fee revenues, should result in the ability to maintain management's guidance of 35%-45% EBITDA growth in 2016, even in the face of softening corporate ADRs," PiperJaffray said in an analyst note according to Barron's

TripAdvisor is still the firm's long-term choice of online travel agent platforms, stemming from the firm's expansion of Instant Book - an addition that's projected to improve on-site and down-stream conversion. 

Shares of Priceline are down 0.99% to $1,339.45 in mid-morning trading, while TripAdvisor stock is slipping 0.56% to $68.90 today. 

Separately, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author. TheStreet Ratings has this to say about the recommendation:

We rate EXPEDIA INC as a Buy with a ratings score of B-. This is driven by a number of strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its robust revenue growth, reasonable valuation levels, good cash flow from operations, expanding profit margins and largely solid financial position with reasonable debt levels by most measures. We feel its strengths outweigh the fact that the company has had sub par growth in net income.

You can view the full analysis from the report here: EXPE

EXPE

data by

YCharts

Loading ...