Online travel company Expedia (NASDAQ:EXPE) is cutting 1,500 jobs as part of its organizational and technological transformation plan. The decision comes at a time when the business expects a slowdown in growth rates and some softening of prices across all categories.
During the Q4 conference call, the company’s outgoing CEO, Peter Kern, said that travel demand could remain relatively healthy in 2024. However, given the challenging year-over-year comparisons, he expects a slowdown in growth rates globally, particularly in the early part of the year.
CEO Transition Plan Hurts EXPE Stock
In addition to the expected moderation in growth rates, concerns around the company’s CEO transition plan have weighed on EXPE stock. Notably, Ariane Gorin has been appointed the new CEO, scheduled to assume her role on May 13, 2024.
With Gorin’s appointment as the company’s group CEO, the stock price of Expedia has dropped by about 15.4%.
On a positive note, Expedia recently delivered better-than-expected Q4 financials. Its top line of $2.89 billion increased 10% year-over-year and exceeded analysts’ average estimate of $2.87 billion. Further, its adjusted earnings of $1.72 per share jumped 37% year-over-year and came ahead of analysts’ average estimate of $1.67.
What is the Analyst Price Target for Expedia?
Despite the recent pullback, EXPE stock is up about 26.3% in one year. Further, analysts’ average price target of $161.81 implies 19.9% upside potential from current levels.
Meanwhile, Wall Street is cautiously optimistic about its prospects. Expedia stock has 13 Buy and 16 Hold recommendations for a Moderate Buy consensus rating.
