Priceline.com, Expedia Are S&P Gainers
NEW YORK (
) -- Shares of
Priceline.com
(PCLN)
and
Expedia
(EXPE) - Get Report
were among the best performers in the
S&P 500
midday Monday.
Priceline and Expedia are some of the best performers on the S&P 500 midday Monday. |
The S&P 500 increased 0.5% midday Monday to 1,349.24.
Shares of Expedia rose 2.12% to $34.25 midday Monday.The travel company reported on Thursday fourth-quarter earnings of $80.6 million, or 44 cents a share, a decline from year-ago earnings of $83.3 million, or 45 cents.
Stifel Nicolaus analyst George Askew raised his price target on the stock to $38 from $35 and maintained his buy rating following Expedia's fourth-quarter results. He noted that people didn't really know what to expect for Expedia's earnings after the company recently spun off
TripAdvisor
(TRIP) - Get Report
.
"We maintain our Buy rating because we believe the company's fundamentals will significantly improve in 2H12 and FY13," Askew said in a report. "Our optimism for the next two years is based on Expedia's technology platform investments which have a proven record of driving higher gross bookings growth."
Askew said he thinks Expedia is "positioned to have a great couple of years" in part based on an upcoming technology upgrade which will allow for faster bookings.
Some of the more positive notes in Expedia's earnings include improvements in international gross bookings.
"Despite concerns of a European slowdown, International gross bookings improved by 15% y/y to $2.48 billion, roughly matching consensus at $2.49 billion, driven by accelerating hotel room-night growth, which improved sequentially from 17% in 3Q to 19% in 4Q," Benchmark analysts wrote in a Feb. 10 report. "Room-night growth remained healthy in both the US and EMEA regions, up in the mid-teens y/y, while APAC recorded higher, accelerating roomnight growth."
Shares of Expedia hit a 52-week high of $34.35. The stock's 52-week low of $18.44 was set on March 2.
Expedia has a forward P/E of 10.86; the average for travel and tourism companies is 23.71. For comparison,
Hertz
(HTZ) - Get Report
and
Dollar Thrifty
(DTG)
have forward P/Es of 12.02 and 15.65, respectively.
Of the 27 analysts who cover Expedia, 14 considered it a hold. Ten analysts rated Expedia a buy and one gave it a sell rating.
TheStreet Ratings
gives Expedia a
and hold rating. The stock has increased 17.88% year to date.
Shares of Priceline.com rose 4.11% to $567.44. Stifel's Askew noted that Greece's improving outlook could have helped lift Priceline's shares to their 52-week high.
"Priceline (PCLN, $540.13, Buy) with its international hotel focus (a market that seems to have remained stable in 4Q11) and lean cost structure is likely immune to thechallenges Expedia faced, although foreign currency volatility has been an issue," Askew wrote in a Feb. 10 report.
Priceline is scheduled to report fourth-quarter earnings on Feb. 27. Analysts, on average, anticipate earnings at $5.05 a share on revenue of $968.32 million.
The travel stock reached a 52-week high Monday of $566.99. The stock's 52-week low of $411.36 was set on Oct. 4.
Priceline has an estimated price-to-earnings ratio for next year of 18.69; the average for travel and tourism companies is 23.71. For comparison,
TripAdvisor
(TRIP) - Get Report
and
Avis
(CAR) - Get Report
both have lower forward P/Es of 18.29 and 7.84, respectively.
Of the 22 analysts who cover the company, 18 gave Priceline a buy rating. Three analysts gave it a hold rating and one rated it a sell.
TheStreet Ratings
gives Priceline.com an A grade with a buy rating and
price target. The stock has increased 20.63% year to date.
-- Written by Alexandra Zendrian
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