Expedia (NASDAQ:EXPE) shares rose nearly 3% intra-day today after Evercore ISI raised its rating for the company to Outperform from In Line, adjusting the price target to $200.00 from $135.00.
The analysts explain this change is due to a variety of factors. Firstly, they believe Expedia is at a critical turning point, anticipating an increase in revenue growth and EBITDA Margin in 2024, which current market estimates haven’t factored in. Secondly, the analysts noted Expedia’s revenue growth is fueled by sustainable internal initiatives and recent developments. This includes the completed technological overhaul of its major brands, the introduction of the OneKey loyalty program, and favorable comparisons to previous performance. These factors are expected to bring Expedia’s key performance indicators like Bookings, Revenue, and Room Nights in line with those of competitors like AirBnB and Booking.
Additionally, the analysts commented on Expedia’s valuation, considering it attractive both intrinsically and in comparison, especially following its over 30% rise after the Q3 earnings report.