Expedia (EXPE) AI Stock Analysis

• Market Cap: $21.04B
• Dividend Yield: 0.24%
• Average Volume (3M): 2.50M
• Price to Earnings (P/E): 19.5
• Beta (1Y): 1.52
• Revenue Growth: 5.57%
• EPS Growth: 61.19%
• Country: US
• Employees: 16,500
• Sector: Consumer Cyclical
• Sector Strength: 75
• Industry: Travel Services
• EPS (TTM): 0.40
• Shares Outstanding: 121,597,440
• 10 Day Avg. Volume: 2,753,646
• 30 Day Avg. Volume: 2,503,582
• PEG Ratio: 0.97
• Price to Book (P/B): 12.94
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 6.61
• Enterprise Value/Market Cap: 0.95
• Enterprise Value/Revenue: 0.38
• Enterprise Value/Gross Profit: 1.70
• Enterprise Value/Ebitda: 2.21
• 1Y Price Target: $183.83
• Price Target Upside: 13.11% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 25

Expedia's stock score reflects a strong financial foundation with notable profitability and cash flow management. Key strengths include the robust performance of the B2B and advertising segments, and strategic initiatives like AI integration. However, challenges such as high leverage and macroeconomic pressures in the consumer business slightly temper the score. The valuation is fair, and recent corporate actions like dividends and share repurchases are positive signs of confidence in the company's future.

Positive Factors

Advertising Revenue Growth

Advertising remains a bright spot with 20% year-over-year revenue growth in Q1 supported by robust partner acquisition and product improvements.

Cost Management

Cost cutting is helping preserve EBITDA growth.

Technological Innovations

Expedia announced new technology solutions for its B2B partners, advertisers and travelers at its annual Explore partner conference.

Negative Factors

Competitive Pressure

Intensifying competition from both online and traditional travel service providers, including Google's expansion into the travel booking space, adds competitive pressure to the industry.

Macroeconomic Impact

Macroeconomic slowdown and recession may impact discretionary spending on travel, negatively affecting travel service providers through fewer bookings and lower rates.

US Market Exposure

Expedia's higher exposure to the US is not ideal given the current backdrop.

Expedia Business Overview & Revenue Model

Company Description

Expedia Group, Inc. operates as an online travel company in the United States and internationally. The company operates through Retail, B2B, and trivago segments. Its brand portfolio include Brand Expedia, a full-service online travel brand with localized websites; Hotels.com for marketing and distributing lodging accommodations; Vrbo, an online marketplace for the alternative accommodations; Orbitz, Travelocity, and CheapTickets travel websites; ebookers, an online EMEA travel agent for travelers an array of travel options; Hotwire, which offers travel booking services; CarRentals.com, an online car rental booking service; Classic Vacations, a luxury travel specialist; and Expedia Cruise, a provider of advice for travelers booking cruises. The company's brand portfolio also comprise Expedia Partner Solutions, a business-to-business brand that provides travel and non-travel vertical, which includes corporate travel management, airlines, travel agents, online retailers and financial institutions; and Egencia that provides corporate travel management services. In addition, its brand portfolio consists of Trivago, a hotel metasearch website, which send referrals to online travel companies and travel service providers from hotel metasearch websites; and Expedia Group Media solutions. Further, the company provides online travel services through its Wotif.com, lastminute.com.au, travel.com.au, Wotif.co.nz, and lastminute.co.nz brands; loyalty programs; hotel accommodations and alternative accommodations; and advertising and media services. It serves leisure and corporate travelers. The company was formerly known as Expedia, Inc. and changed its name to Expedia Group, Inc. in March 2018. Expedia Group, Inc. was founded in 1996 and is headquartered in Seattle, Washington.

How the Company Makes Money

Expedia generates revenue primarily through the facilitation of travel bookings across its various platforms, earning income via commissions and service fees. The company partners with a wide range of travel suppliers, including airlines, hotels, car rental companies, and tour operators, to offer an extensive selection of travel options. Key revenue streams include hotel and lodging bookings, which provide a significant portion of its earnings through the merchant model (where Expedia purchases rooms at a discount and sells them at a markup) and the agency model (where Expedia earns a commission on bookings). Additionally, the company earns revenue from advertising and media services, as well as from its Vrbo platform, which focuses on vacation rental properties. Strategic partnerships and collaborations with travel service providers and technology companies further enhance Expedia's offerings and market reach, contributing to its overall financial performance.

Expedia Financial Statement Overview

Summary

Expedia's financial health is strong, with high profitability and revenue growth. Notably, the debt-to-equity ratio improved significantly, indicating reduced leverage, and cash flows are robust. However, the low equity ratio and decreasing EBITDA margins present potential risks.

Income Statement

Expedia's income statement reflects strong profitability and revenue growth. The gross profit margin remains high at approximately 89.5% for 2024, indicating effective cost management. The net profit margin has improved significantly from previous years, reaching 9.0% in 2024, up from 6.2% in 2023, highlighting enhanced operational efficiency. Revenue growth is robust, with a 6.6% increase from 2023 to 2024. However, EBITDA margin has decreased from 16.1% in 2023 to 11.0% in 2024, suggesting some pressure on earnings before interest, taxes, depreciation, and amortization.

Balance Sheet

The balance sheet shows a mixed picture. The debt-to-equity ratio has improved to 0.84 in 2024 from 4.28 in 2023, indicating reduced leverage. The equity ratio is low at 6.95%, reflecting a limited proportion of equity financing. Return on equity (ROE) has increased to 79.3% in 2024, showcasing strong profitability from shareholders' equity. However, the low equity base poses a potential risk of financial instability.

Cash Flow

Expedia's cash flow statement is strong, with significant operating cash flow of $3.085 billion in 2024, reflecting robust cash generation capacity. The free cash flow has increased by 67.3% from 2023 to 2024, indicating efficient capital expenditure management. The operating cash flow to net income ratio is high at 2.50, suggesting excellent conversion of income into cash. However, financing cash flow is negative, reflecting outflows that may require careful monitoring.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
13.69B	12.84B	11.67B	8.60B	5.20B
	Gross Profit
12.25B	11.27B	10.01B	7.08B	3.52B
	EBIT
1.32B	1.03B	864.00M	186.00M	-1.53B
	EBITDA
2.63B	2.07B	1.61B	1.13B	-1.90B
	Net Income Common Stockholders
1.23B	797.00M	352.00M	12.00M	-2.73B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
5.87B	5.69B	4.14B	4.31B	3.39B
	Total Assets
22.39B	21.64B	21.56B	21.55B	18.69B
	Total Debt
6.53B	6.57B	6.55B	8.81B	8.73B
	Net Debt
2.35B	906.00M	2.46B	4.70B	5.37B
	Total Liabilities
19.59B	18.86B	17.83B	18.00B	14.66B
	Stockholders Equity
1.56B	1.53B	2.28B	2.06B	2.53B
Cash Flow		Free Cash Flow
2.33B	1.84B	2.78B	3.08B	-4.63B
	Operating Cash Flow
3.08B	2.69B	3.44B	3.75B	-3.83B
	Investing Cash Flow
-1.26B	-800.00M	-580.00M	-931.00M	-263.00M
	Financing Cash Flow
-1.75B	-2.10B	-2.62B	-973.00M	4.08B

Expedia Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 162.52
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For EXPE, the sentiment is Negative. The current price of 162.52 is below the 20-day moving average (MA) of 163.16, above the 50-day MA of 161.31, and below the 200-day MA of 164.77, indicating a neutral trend. The MACD of 1.46 indicates Negative momentum. The RSI at 49.35 is Neutral, neither overbought nor oversold. The STOCH value of 65.07 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for EXPE.

Expedia Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ABNB	78 Outperform	$85.57B	34.37	32.06%	―	9.68%	-47.83%
BKNG	77 Outperform	$175.00B	33.46	-146.32%	0.67%	9.47%	20.70%
TRIP	77 Outperform	$1.96B	40.07	5.91%	―	1.43%	121.44%
TCOM	76 Outperform	$43.57B	18.87	12.49%	0.42%	18.12%	69.44%
EXPE	75 Outperform	$21.04B	19.50	119.16%	0.24%	5.57%	61.19%
MMYT	75 Outperform	$11.51B	124.18	8.33%	―	28.51%	367.34%
Sector *	62 Neutral	$6.98B	11.38	2.86%	3.90%	2.64%	-22.07%

Expedia Corporate Events

Expedia Announces Dividend Amid Strong Q1 2025 Results

On May 8, 2025, Expedia Group announced a quarterly cash dividend of $0.40 per share, payable on June 18, 2025. The company reported its first-quarter 2025 financial results, highlighting a 4% growth in bookings and a 3% increase in revenue year-over-year, despite softened travel demand in the U.S. Notably, Expedia exceeded its bottom-line guidance with a 16% increase in adjusted EBITDA and a significant share repurchase of $330 million. The results underscore Expedia’s strategic focus on margin expansion and top-line growth.

Spark’s Take on EXPE Stock

According to Spark, TipRanks’ AI Analyst, EXPE is a Outperform.

Expedia’s overall stock score reflects solid financial performance with strong revenue growth and profitability, as well as efficient cash flow management. The earnings call provided positive guidance, but some caution is warranted due to potential softening travel demand and foreign exchange impacts. The technical analysis suggests mixed signals, and the valuation appears fair for the industry. The company’s strategic focus on enhancing operational efficiencies and global expansion efforts are key strengths supporting the score.

To see Spark’s full report on EXPE stock, click here.