Download PDF

1. Company Snapshot

1.a. 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.

Show Full description

1.b. Last Insights on EXPE

Expedia Group's recent performance was driven by robust Q3 financial results, with revenue growth surpassing Wall Street expectations. The company's B2B segment showed significant growth, and hotel bookings were higher. Management raised full-year revenue growth guidance, citing strong bookings growth across consumer and B2B channels. According to analysts, the company is rated a Strong Buy, with a price target reflecting significant upside potential. Expedia's margin gains were fueled by disciplined operating expenses. Its Q3 earnings and revenues surpassed estimates.

1.c. Company Highlights

2. Expedia's Q3 Results Exceed Expectations

Expedia Group delivered a strong third quarter, with revenue growing 9% and adjusted EBITDA margin expanding by 2 points to 33%, resulting in adjusted EBITDA of $1.4 billion. The company's adjusted EPS came in at $7.57, beating estimates of $6.97. The revenue growth was driven by a 12% increase in bookings, with booked room nights rising 11% and B2B bookings increasing 26%, marking the 17th consecutive quarter of double-digit growth.

Publication Date: Nov -09

📋 Highlights
  • Revenue & EBITDA Growth: Revenue rose 9% YoY; adjusted EBITDA hit $1.4B (33% margin), up 2 points.
  • B2B Bookings Surge: +26% growth, 17th consecutive quarter of double-digit B2B expansion.
  • AI-Driven Margin Expansion: EBITDA margins expanded by 2 points via AI efficiency and cost controls.
  • Vrbo & Hotels.com Momentum: Vrbo gained U.S. market share; Hotels.com grew at fastest pace in 2+ years.
  • Q4 Guidance Raised: 6–8% gross bookings/revenue growth expected, with 2-point EBITDA margin expansion.

Operational Highlights

The company's operational performance was characterized by disciplined execution and progress on its strategic priorities, with Expedia remaining the largest and fastest-growing brand. Hotels.com and Vrbo also saw improvements, with Hotels.com growing at its fastest pace in over 2 years. The company's focus on personalization and AI-driven tools contributed to the growth, with features like AI filters and property Q&A enhancing the traveler experience.

Margin Expansion and Guidance

The company's margin expansion was driven by revenue and expense leverage, particularly within direct sales and marketing in the B2C segment. Expedia raised its Q4 guidance, expecting gross bookings and revenue growth to be between 6% to 8%, with adjusted EBITDA margins expanding by approximately 2 points. The company's confidence in its Q4 guidance is reflected in its expectation of continued growth, despite potential market dynamics challenges.

Valuation Metrics

With a P/E Ratio of 23.02 and an EV/EBITDA of 10.86, the market appears to be pricing in a certain level of growth for Expedia. The company's ROE of 115.62% and ROIC of 17.92% indicate a strong ability to generate returns on equity and invested capital. As analysts estimate next year's revenue growth at 6.8%, it is essential to assess whether the current valuation multiples are justified by the company's growth prospects.

Outlook

Expedia's focus on its core strategic priorities, including investing in growth opportunities and driving operational efficiencies, is expected to continue driving long-term profitable growth. The company's confidence in its ability to execute and create value for stakeholders is reflected in its guidance and operational performance. As the company navigates the final quarter of the year, its ability to maintain momentum and adapt to market dynamics will be crucial in achieving its growth objectives.

3. NewsRoom

Card image cap

EXPEDIA LAUNCHES SHOPPABLE SET-JETTING TRAVEL HUB TO TURN ON-SCREEN SCENES INTO REAL-LIFE ITINERARIES

Dec -03

Source: businesswire.com

Card image cap

Expedia: The Gap To Peers Has Closed (Upgrade)

Dec -02

Source: seekingalpha.com

Card image cap

EXPE or MELI: Which Is the Better Value Stock Right Now?

Dec -02

Source: zacks.com

Card image cap

AI Pushes Black Friday E-Commerce Sales to a Record-High: 5 Picks

Dec -01

Source: zacks.com

Card image cap

5 Momentum Stocks to Buy for December After a Mixed November

Dec -01

Source: zacks.com

Card image cap

Travel Stocks Gains Focus on Thanksgiving-- Here are Top 5 Names to Watch

Nov -27

Source: gurufocus.com

Card image cap

4 Retail Stocks to Grab on Robust Holiday Sales Growth Projection

Nov -26

Source: zacks.com

Card image cap

Is Expedia Group (EXPE) Outperforming Other Retail-Wholesale Stocks This Year?

Nov -24

Source: zacks.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (6.75%)

6. Segments

B2C

Expected Growth: 6.5%

B2C growth driven by increasing online travel adoption, mobile bookings, and expanding presence in Asia-Pacific. Strong brand recognition, competitive pricing, and user-friendly interfaces also contribute to growth. Additionally, strategic partnerships, loyalty programs, and personalized marketing efforts enhance customer retention and acquisition, resulting in a 6.5% growth rate.

B2B

Expected Growth: 7.5%

Expedia Group's B2B segment growth of 7.5% is driven by increasing adoption of its B2B travel platform, Expedia Partner Solutions, among travel agencies and tour operators. Additionally, the company's focus on expanding its accommodation inventory, improving user experience, and investing in digital marketing initiatives have contributed to the growth.

Trivago

Expected Growth: 6.0%

Trivago's 6.0% growth is driven by increasing online travel agency (OTA) market share, strong brand recognition, and effective marketing strategies. Additionally, the company's focus on hotel search and price comparison, as well as its expanding global presence, contribute to its growth momentum.

7. Detailed Products

Expedia.com

A full-service online travel agency that allows users to book flights, hotels, car rentals, and vacation packages.

Hotels.com

A specialized online travel agency focused on booking hotels and accommodations.

VRBO (Vacation Rentals by Owner)

A platform that allows homeowners to rent out their properties to travelers.

Egencia

A corporate travel management company that helps businesses manage their travel programs.

Orbitz

An online travel agency that allows users to book flights, hotels, and car rentals.

Travelocity

An online travel agency that allows users to book flights, hotels, and car rentals.

Expedia Partner Solutions

A B2B platform that provides travel technology and services to partners.

Expedia Affiliate Network

A program that allows partners to earn commissions by promoting Expedia's travel products.

8. Expedia Group, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Expedia Group, Inc. faces moderate threat from substitutes, as customers have various options for booking travel, including direct booking with airlines and hotels, as well as other online travel agencies.

Bargaining Power Of Customers

Expedia Group, Inc. has a large customer base, but individual customers have significant bargaining power due to the ease of switching to alternative booking platforms.

Bargaining Power Of Suppliers

Expedia Group, Inc. has a large portfolio of travel suppliers, which reduces the bargaining power of individual suppliers, giving the company more negotiating power.

Threat Of New Entrants

The online travel agency market has high barriers to entry, including significant investments in technology and marketing, which reduces the threat of new entrants.

Intensity Of Rivalry

The online travel agency market is highly competitive, with Expedia Group, Inc. competing with other major players such as Booking Holdings and Airbnb, leading to a high intensity of rivalry.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 80.37%
Debt Cost 5.52%
Equity Weight 19.63%
Equity Cost 13.14%
WACC 7.02%
Leverage 409.32%

11. Quality Control: Expedia Group, Inc. passed 6 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Travel + Leisure

A-Score: 6.6/10

Value: 8.0

Growth: 4.7

Quality: 6.0

Yield: 7.0

Momentum: 8.0

Volatility: 5.7

1-Year Total Return ->

View Full Report
Stock-Card
Expedia

A-Score: 5.3/10

Value: 4.2

Growth: 6.6

Quality: 6.9

Yield: 0.0

Momentum: 8.5

Volatility: 5.7

1-Year Total Return ->

View Full Report
Stock-Card
Carnival

A-Score: 4.6/10

Value: 5.3

Growth: 4.7

Quality: 5.1

Yield: 0.0

Momentum: 8.0

Volatility: 4.7

1-Year Total Return ->

View Full Report
Stock-Card
Norwegian Cruise Line

A-Score: 4.2/10

Value: 6.0

Growth: 5.0

Quality: 4.5

Yield: 0.0

Momentum: 5.5

Volatility: 4.0

1-Year Total Return ->

View Full Report
Stock-Card
Tripadvisor

A-Score: 4.0/10

Value: 5.2

Growth: 4.2

Quality: 5.7

Yield: 0.0

Momentum: 6.0

Volatility: 3.0

1-Year Total Return ->

View Full Report
Stock-Card
Arhaus

A-Score: 3.5/10

Value: 4.2

Growth: 4.1

Quality: 4.9

Yield: 0.0

Momentum: 5.5

Volatility: 2.3

1-Year Total Return ->

View Full Report

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

263.31$

Current Price

263.31$

Potential

-0.00%

Expected Cash-Flows