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3 ‘Large-Cap Travel’ Stocks with Rising Website Traffic
Stock Analysis & Ideas

3 ‘Large-Cap Travel’ Stocks with Rising Website Traffic

The U.S. economy is recovering fast from the turmoil caused by the coronavirus pandemic since its onset in 2020. The country’s GDP has improved on the back of domestic and international trade picking up pace, increased consumption, and broad-based activities being witnessed across industries.

Amid all these positives, the travel and tourism industry in the United States has shown remarkable growth. Despite high fuel costs and stricter norms and regulations, the industry has witnessed a significant surge in demand for business- and leisure-related as well as domestic and international traveling.

According to a report by Statista on the U.S. travel and tourism industry, revenues in this industry are projected to increase to $128.4 billion this year. From 2022 to 2026, the industry’s revenues are expected to increase at a CAGR of 9.81%. Also, online sales are projected to account for almost 70% of the industry’s revenue by 2026.

So, with the growing acceptance and importance of online activities in the travel and tourism industry, a closer look at the website traffic activities of major industry players becomes imperative.

At this juncture, the TipRank’s Website Traffic Tool comes in handy. This tool uses website traffic related-data provided by SEMrush Holdings (NYSE: SEMR), a specialist in website usage monitoring services.

Using this tool, we have selected three travel companies that have a market capitalization of >$20 billion and monthly visitors of more than 50 million.

Booking Holdings Inc. (NASDAQ: BKNG)

The $82.2-billion company provides users with an online platform for reservations in restaurants and making travel-related bookings. Its online platforms include Booking.com, Rentalcars.com, and others.

In the first quarter of 2022, revenues of the Norwalk, CT-based company surged 136% year-over-year, driven by a 129% increase in gross travel bookings.

The CEO of Booking Holdings, Glenn Fogel, said, “Despite an uncertain macroeconomic environment, we have seen continued strengthening of global travel trends so far in the second quarter of 2022, and we are preparing for a busy summer travel season ahead.”

On May 5, James Lee of Mizuho Securities reiterated a Buy rating on BKNG while lowering the price target to $2,750 (35.9% upside potential) from $2,950 on compressed multiples for the industry.

 “The company continues to execute on marketing plans to bundle and cross-sell air and experiences to leverage its payments platform and gain a larger share of accommodation post the pandemic,” said the analyst.

Overall, the company has a Moderate Buy consensus rating based on 18 Buys and seven Holds. Booking Holdings’ price forecast of $2,806.61 suggests 38.7% upside potential from current levels. Over the past year, shares of Booking Holdings have declined 10.6%.

The healthy growth prospects of BKNG are supported by a surge in its website traffic. The TipRanks Website Traffic tool shows that the footfall on Booking Holdings’ websites (including booking.com and two others) increased 40.38% year-over-year in April and 23.4% year-to-date from the comparable period last year.

The company’s website traffic surged 17.83% year-over-year in the first quarter of 2022.

Airbnb, Inc. (NASDAQ: ABNB)

The San Francisco, CA-based company provides an online platform for booking accommodation facilities and travel services. Its online platform is airbnb.com.

The $77.1-billion company recorded a 70% year-over-year increase in revenues and 59% growth in bookings in the first quarter of 2022.

In the second quarter, Airbnb anticipates bookings to be driven by huge demand in North America, Latin America, and EMEA. Revenues are expected to be $2.03-$2.13 billion in the second quarter.

On May 5, Shyam Patil of Susquehanna maintained a Buy rating on Airbnb while lowering the price target to $190 (59.17% upside potential) from $235. The analyst believes that Airbnb is “a must-own stock for the recovery given its strong positioning, promising long-term opportunity, and profitability improvements.”

Overall, the company’s Moderate Buy consensus rating is based on 13 Buys, 16 Holds, and one Sell. Airbnb’s average price target of $191.57 mirrors 60.48% upside potential from current levels. Shares of this company have declined 18.7% in the past year.

Interestingly, the traffic to Airbnb’s website (airbnb.com) increased 38.04% year-over-year in April and is up 51.63% year-to-date.

In the first quarter of 2022, the footfall on the company’s website grew 57.33% year-over-year.

Expedia Group, Inc. (NASDAQ: EXPE)

The $20.1-billion online provider of travel- and leisure-related products and services operates through expedia.com and other sites.

In the first quarter of 2022, the company’s revenues and bookings increased 81% and 58% year-over-year, respectively.

Expedia’s Vice-Chairman and CEO, Peter Kern, is positive about a “strong recovery in leisure travel this summer.” He is happy “to see city, business, and international travel coming back, three components key to the complete return of travel.”

On May 3, Brad Erickson of RBC Capital maintained a Hold rating on EXPE while lowering the price target to $185 (44.77% upside potential) from $200. 

The analyst believes that the company is “well-positioned to benefit as developed market travel rebounds.” However, he opines that the top-line recovery and margin expansion are “fairly baked into shares.”

Overall, the Seattle, WA-based company has a Moderate Buy consensus rating based on 13 Buys and 14 Holds. Expedia’s price forecast of $215.17 suggests 68.38% upside potential from current levels. Over the past year, shares of Expedia have declined 26.2%.

A look at the company’s website traffic reveals that the number of visits to expedia.com and two other websites was up 55.06% year-over-year in April. Year-to-date, the website traffic has grown 49.79% compared with the same period last year.

The traffic to the company’s websites increased 47.91% year-over-year in the first quarter of 2022.

Conclusion

Though not immune to geopolitical tensions, cost inflation, and high fuel prices, Booking Holdings, Airbnb, and Expedia have strong reasons to rejoice and leverage the pent-up demand in the travel and tourism industry in the United States. Further, an increasing flow to the websites is indicative of rising popularity and healthy growth prospects for these online platform/service providers.

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