Expedia price target raised by $40 at Oppenheimer, here’s why

Oppenheimer raised the firm’s price target on Expedia to $175 from $135 and keeps an Outperform rating on the shares. The firm notes Expedia remains its top Online Travel pick into 2024 on higher operational efficiencies from unifying its tech-stack/loyalty-programs and increasing B2B scale, that now require less Opex pull-forward for growth initiatives. Oppenheimer forecasts EBITDA growing at 2023-2025 CAGR of 13%, on 9% revenue growth, gross margins expanding 40bps, limited S&M leverage, and Opex growing 7%. Further, the firm sees upside on re-entering Europe with quicker payback periods.