Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.
NEW YORK (
) has been reiterated by TheStreet Ratings as a buy with a ratings score of B-. The company's strengths can be seen in multiple areas, such as its solid stock price performance, robust revenue growth, reasonable valuation levels, expanding profit margins and good cash flow from operations. We feel these strengths outweigh the fact that the company has had sub par growth in net income.
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Highlights from the ratings report include:
- Compared to its closing price of one year ago, EXPE's share price has jumped by 103.85%, exceeding the performance of the broader market during that same time frame. Regarding the stock's future course, although almost any stock can fall in a broad market decline, EXPE should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
- Despite its growing revenue, the company underperformed as compared with the industry average of 25.3%. Since the same quarter one year prior, revenues rose by 23.8%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
- The gross profit margin for EXPEDIA INC is currently very high, coming in at 81.80%. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of 0.69% trails the industry average.
- Net operating cash flow has increased to -$216.73 million or 19.50% when compared to the same quarter last year. Despite an increase in cash flow, EXPEDIA INC's average is still marginally south of the industry average growth rate of 25.21%.
Expedia, Inc., together with its subsidiaries, operates as an online travel company in the United States and internationally. Expedia has a market cap of $7.6 billion and is part of the services sector and leisure industry. The company has a P/E ratio of 29.00, above the S&P 500 P/E ratio of 18.00. Shares are up 0.4% year to date as of the close of trading on Monday.
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--Written by a member of TheStreet Ratings Staff.
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