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Chicago, IL – June 8, 2018 – Today, Zacks Investment Ideas feature highlights Features: Expedia Group Inc (EXPE - Free Report) , TripAdvisor Inc (TRIP - Free Report) and Booking Holdings (BKNG - Free Report) .
As We Head into Summer, Check Out These Travel Stocks
U.S. airlines are anticipating the best summer travel season ever in 2018, with 246 million passengers expected to take to the skies between June 1st and August 31st, beating the previous record of 237 million passengers set in 2017. A strong economy is fueling the boom as Americans can increasingly afford to travel afar on Summer vacations, although lower airfares and higher fuel costs will likely dampen the effects on net earnings for air carriers.
Hotels, restaurants and car rentals would also logically enjoy the upswing, after all, after travelers arrive at their destinations, they have to get around, stay somewhere and eat, though labor and commodity costs threaten earnings in those sectors, too.
What if there was a single investment that would benefit from the rise in bookings, but was not subject to the rising costs in the travel and entertainment industry? There is.
Buy the Middleman
Travel booking sites provide one-stop shopping for consumers by aggregating millions of price quotes and providing reservation and referral services, collecting a small percentage on each transaction. They benefit from the increase in activity, regardless of the earnings of their partners.
But there are so many of these sites – as evidenced by the massive volume of television and online advertising we see every day – that it would be hard to pick the winners out of a huge crowd, right?
Not really.
Expedia, Hotels.com, HomeAway, Trivago, Orbitz, hotwire, CarRentals.com, TripAdvisor, VacationHomeRentals.com, Booking.com, Priceline, Kayak, RentalCars.com and OpenTable are all divisions or subsidiaries of just three publicly traded companies. So are dozens of other lesser known sites operating in the U.S. and around the globe.
Expedia Group Inc has been growing its business through a network of majority owned subsidiaries including over a million bookable vacation listings and airline, car rental and cruise reservations. Notable brands include Expedia, Orbitz, Hotels.com and Trivago.
After a Q1 earnings beat, Expedia shares are up 20% from their February lows. The company trades at a 12 month forward P/E Ratio of 30X, which - while high for the market as a whole – is considerably lower than the Electronic Commerce Industry at 56.7X. Expedia’s Price to Sales Ratio is just 1.8X versus 7.2X for the industry.
The Zacks Consensus estimate for earnings in Q3 and full year 2018 are now 30% and 22% higher than 2017 results. Expedia Group is a Zacks Rank #1 (Strong Buy).
Spun off from Expedia in 2011, TripAdvisor Inc operates the popular TripAdvisor site as well as 24 other brands all over the globe, including China. Also performing strongly after unexpected strong Q1 earnings, TRIP shares are up 44% since the report on May 8th.
Recent analyst upgrades have been a tailwind for the company which is now expected to earn $1.30/share in 2018, up from $1.15/share just 30 days ago and 30% higher than 2017. TripAdvisor is a Zacks Rank #2 (Buy).
Booking Holdings - Formerly the Priceline Group (until a name change in February) - is comprised of Booking.com, Priceline.com, Kayak, RentalCars.com and the popular restaurant reservation service OpenTable.
Since acquiring Booking.com in 2006, shares in the company have risen from the mid-$20s to a recent high of $22.28/share. BKNG has the revenues and earnings to match the high price however, with expected sales in 2018 of $14.6B and earnings of $88.84/share. This values BKNG at an industry low forward P/E ratio of just 24.4X.
Booking Holdings is currently a Zacks Rank #3 (Hold).
In a recently hot market like travel reservations, it can pay to look past the obvious providers to the companies that provide services customers demand and get paid handsomely for it. These travel reservation sites all fit the bill.
Will You Make a Fortune on the Shift to Electric Cars?
Here's another stock idea to consider. Much like petroleum 150 years ago, lithium power may soon shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge. With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research. It's not the one you think. See This Ticker Free >>
Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
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Zacks Investment Ideas feature highlights: Expedia Group, TripAdvisor and Booking Holdings
For Immediate Release
Chicago, IL – June 8, 2018 – Today, Zacks Investment Ideas feature highlights Features: Expedia Group Inc (EXPE - Free Report) , TripAdvisor Inc (TRIP - Free Report) and Booking Holdings (BKNG - Free Report) .
As We Head into Summer, Check Out These Travel Stocks
U.S. airlines are anticipating the best summer travel season ever in 2018, with 246 million passengers expected to take to the skies between June 1st and August 31st, beating the previous record of 237 million passengers set in 2017. A strong economy is fueling the boom as Americans can increasingly afford to travel afar on Summer vacations, although lower airfares and higher fuel costs will likely dampen the effects on net earnings for air carriers.
Hotels, restaurants and car rentals would also logically enjoy the upswing, after all, after travelers arrive at their destinations, they have to get around, stay somewhere and eat, though labor and commodity costs threaten earnings in those sectors, too.
What if there was a single investment that would benefit from the rise in bookings, but was not subject to the rising costs in the travel and entertainment industry? There is.
Buy the Middleman
Travel booking sites provide one-stop shopping for consumers by aggregating millions of price quotes and providing reservation and referral services, collecting a small percentage on each transaction. They benefit from the increase in activity, regardless of the earnings of their partners.
But there are so many of these sites – as evidenced by the massive volume of television and online advertising we see every day – that it would be hard to pick the winners out of a huge crowd, right?
Not really.
Expedia, Hotels.com, HomeAway, Trivago, Orbitz, hotwire, CarRentals.com, TripAdvisor, VacationHomeRentals.com, Booking.com, Priceline, Kayak, RentalCars.com and OpenTable are all divisions or subsidiaries of just three publicly traded companies. So are dozens of other lesser known sites operating in the U.S. and around the globe.
Expedia Group Inc has been growing its business through a network of majority owned subsidiaries including over a million bookable vacation listings and airline, car rental and cruise reservations. Notable brands include Expedia, Orbitz, Hotels.com and Trivago.
After a Q1 earnings beat, Expedia shares are up 20% from their February lows. The company trades at a 12 month forward P/E Ratio of 30X, which - while high for the market as a whole – is considerably lower than the Electronic Commerce Industry at 56.7X. Expedia’s Price to Sales Ratio is just 1.8X versus 7.2X for the industry.
The Zacks Consensus estimate for earnings in Q3 and full year 2018 are now 30% and 22% higher than 2017 results. Expedia Group is a Zacks Rank #1 (Strong Buy).
Spun off from Expedia in 2011, TripAdvisor Inc operates the popular TripAdvisor site as well as 24 other brands all over the globe, including China. Also performing strongly after unexpected strong Q1 earnings, TRIP shares are up 44% since the report on May 8th.
Recent analyst upgrades have been a tailwind for the company which is now expected to earn $1.30/share in 2018, up from $1.15/share just 30 days ago and 30% higher than 2017. TripAdvisor is a Zacks Rank #2 (Buy).
Booking Holdings - Formerly the Priceline Group (until a name change in February) - is comprised of Booking.com, Priceline.com, Kayak, RentalCars.com and the popular restaurant reservation service OpenTable.
Since acquiring Booking.com in 2006, shares in the company have risen from the mid-$20s to a recent high of $22.28/share. BKNG has the revenues and earnings to match the high price however, with expected sales in 2018 of $14.6B and earnings of $88.84/share. This values BKNG at an industry low forward P/E ratio of just 24.4X.
Booking Holdings is currently a Zacks Rank #3 (Hold).
In a recently hot market like travel reservations, it can pay to look past the obvious providers to the companies that provide services customers demand and get paid handsomely for it. These travel reservation sites all fit the bill.
Will You Make a Fortune on the Shift to Electric Cars?
Here's another stock idea to consider. Much like petroleum 150 years ago, lithium power may soon shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge. With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research. It's not the one you think. See This Ticker Free >>
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.