June 20, 2024
Top 10 Stock Expedia Buy Recommendation
How to read the ranks
For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".
Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".
Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.
Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.
(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).
(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.
Snapshot: Expedia – Top 10 Stock in S&P 500 Consumer Discretionary Index
expediagroup.comhomedefault.aspx
Expedia is listed as a top 10 stock on June 20, 2024 in the market index S&P US Luxury because of its high performance in at least one of the Obermatt investment strategies. Three consolidated Obermatt Ranks are above-average. Only the Value Rank is below average. The investment rationale may be an investment in future growth, supported by professional market opinion. Based on the Obermatt 360° View of 63 (high 63% performer), Obermatt assesses an overall buy recommendation for Expedia on June 20, 2024.
Snapshot: Obermatt Ranks
| Country | USA |
| Industry | Hotels, Resorts & Cruise Lines |
| Index | Diversity USA, NASDAQ 100, NASDAQ, S&P US Luxury, S&P 500 |
| Size class | X-Large |
When Obermatt identifies the Top 10 stocks in a market, it’s based on a certain investment strategy. The best performing stocks usually aren’t the ones that everyone is talking about (those are often "over-priced" and have low Value ranks).
For each investment strategy, we provide you with more detailed analysis and our recommendation. You see the ranks of the top 10 stocks ranked by that particular investment strategy (360° View, Sentiment, Value, Growth, Safety and Combined Financial Performance).
360° View: Obermatt 360° View Expedia Buy
| 360 METRICS | June 20, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 28 |
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| GROWTH | ||||||||
| GROWTH | 75 |
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| SAFETY | ||||||||
| SAFETY | 53 |
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| SENTIMENT | ||||||||
| SENTIMENT | 64 |
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| 360° VIEW | ||||||||
| 360° VIEW | 63 |
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ANALYSIS: With an Obermatt 360° View of 63 (better than 63% compared with alternatives), overall professional sentiment and financial characteristics for the stock Expedia are above average. The 360° View is based on consolidating four consolidated indicators, with all but one indicator above average for Expedia. The consolidated Growth Rank has a good rank of 75, which means that the company experiences above-average growth momentum when looking at financial metrics such as revenue, profit, and invested capital growth, as well as stock returns. This means that growth is higher than for 75% of competitors in the same industry. The consolidated Safety Rank at 53 means that the company has a financing structure that is safer than 53% comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. Finally, the consolidated Sentiment Rank has a good rank of 64, which means that professional investors are more optimistic about the stock than for 64% of alternative investment opportunities. But the consolidated Value Rank is less desirable at 28, meaning that the share price of Expedia is on the higher side compared with indicators such as revenues, profits, and invested capital. This means the stock price is higher than for 72% of alternative stocks in the same industry. ...read more
RECOMMENDATION: With a consolidated 360° View of 63, Expedia is better positioned than 63% of all alternative stock investment opportunities based on the Obermatt Method. As three out of four consolidated Obermatt Ranks exhibit excellent performance, such as above-average growth (Growth Rank of 75), a safe financing structure (Safety Rank of 53), and positive professional market sentiment (Sentiment Rank of 64), it is a solid stock investment where growth may be the strongest driver of the investment rationale, also reflected by institutional investors. It is typical for growth companies to have low value, as is the case here. Investors are willing to pay more for companies that outperform their competitors. So the question is, how much more do you pay for the stock of Expedia compared with alternatives? You can use the following rule of thumb: The growth rank measures the growth momentum of the company (75% better than peers). The value rank could be the reverse reflection of that (25%). A Value Rank below that level may be assessed as expensive, a rank above that is still good value. Sometimes market sentiment just reflects the past, sometimes the reality. You pay more than the market average for this stock, but it may be worth it. ...read more
Sentiment Strategy: Professional Market Sentiment for Expedia positive
ANALYSIS: With an Obermatt Sentiment Rank of 64 (better than 64% compared with alternatives), overall professional sentiment and engagement for the stock Expedia is above average. The Sentiment Rank is based on consolidating four sentiment indicators, with half of the metrics below and half above average for Expedia. Analyst Opinions are at a rank of 13 (worse than 87% of alternative investments), which means that currently, stock research analysts tend to warn against investing in the stock of the company. Worse, Analyst Opinions Change has a rank of 46, which means that stock research experts are getting even more pessimistic. Other sentiment indicators are positive: The Professional Investors rank is 72, which means that professional investors hold more stock in this company than in 72% of alternative investment opportunities. So, pros tend to favor investing in this company. In addition, Market Pulse has a rank of 79, which means that the current professional news and professional social networks tend to be positive when discussing this company (more positive news than for 79% of competitors). While stock research analysts are getting ever more critical, many professional investors are committed to Expedia and the professional news channels are on the positive side. ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 64 (more positive than 64% compared with investment alternatives), Expedia has a reputation among professional investors that is above-average compared with that of its competitors. This is an ambiguous picture: analysts are negative and getting even more critical, while the news in the market is positive. Who should investors believe? This is a difficult question in such a situation. Investors should proceed cautiously and verify not only the financial performance in the Obermatt Value, Growth and Safety Ranks but also independent news coverage of the company. ...read more
Value Strategy: Expedia Stock Price Value below-average critical
ANALYSIS: With an Obermatt Value Rank of 28 (worse than 72% compared with alternatives), Expedia shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators, with three out of four indicators below average for Expedia. Only Price-to-Profit (also referred to as price-earnings, P/E) indicates good stock value with a rank of 90, which means that the stock price compared with what market professionals expect for future profits is lower than for 90% of comparable companies, indicating a good value concerning Expedia's profit levels. But Price-to-Sales is 45 which means that the stock price compared with what market professionals expect for future profits is higher than for 55% of comparable companies, indicating a low value concerning Expedia's profit levels. The same is valid for Price-to-Book Capital (also referred to as market-to-book ratio) with a Price-to-Book Rank of 10 and for dividend yield, which is lower than for 99% of comparable companies, making the stock more expensive as regards to the company's expected dividend payouts. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 28, is a hold recommendation based on Expedia's stock price compared with the company's operational size and dividend yields. Can we rely on only one good value indicator? Only if we know the company well. In this case, a high Price-to-Profit Rank, while Price-to-Sales and Price-to-Book are both below the market typical levels, means that the company can charge higher prices for its products and needs less capital to produce them. If this is sustainable, then Expedia is a good investment because profits count most in enterprise valuations. The low dividend yield indicates that the company is confident it can do something with the generated cash that is more valuable than paying the profits out to the shareholders in the form of dividends. ...read more
Growth Strategy: Expedia Growth Momentum high
ANALYSIS: With an Obermatt Growth Rank of 75 (better than 75% compared with alternatives) for 2024, Expedia shows one of the highest growth dynamics in its industry. Investors also speak of high momentum. The Growth Rank is based on consolidating four value indicators, with all four indicators above average for Expedia. Sales Growth has a value of 68, which means that, currently, professionals expect the company to grow more than 68% of its competitors. The same is valid for Profit Growth with a value of 55 and for Capital Growth with 51. In addition, Stock Returns had an above-average rank value of 85, which means they have been higher than 85% of comparable investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 75, is a buy recommendation for growth and momentum investors. Since all Growth Ranks are positive, Expedia exhibits above-average growth momentum. This could be due to a uniquely strong market position, proprietary technology, or an extensive corporate acquisition strategy. Growth investors will find this an attractive investment opportunity, unless they expect that the current phase is transitory and will deteriorate in the future. The current performance could also be a temporary recovery from a very low point, such as a turn-around situation. In the case of a turn-around, the current performance may or may not be followed by a continuing positive development. ...read more
Safety Strategy: Expedia Debt Financing Safety above-average
| SAFETY METRICS | June 20, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 52 |
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| REFINANCING | ||||||||
| REFINANCING | 18 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 82 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 53 |
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ANALYSIS: With an Obermatt Safety Rank of 53 (better than 53% compared with alternatives), the company Expedia has financing practices on the safer side, which mean that their overall debt burden is lower than average. This doesn't mean that the business of Expedia is safe, it only means that the company is on the safer side regarding possible bankruptcy, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with two out of three indicators above average for Expedia. Leverage is at a rank of 52, meaning the company has a below-average debt-to-equity ratio. It has less debt than 52% of its competitors. Liquidity is also good at a rank of 82, meaning the company generates more profit to service its debt than 82% of its competitors. This indicates that the company is on the safer side when it comes to debt service. But Refinancing is lower at a rank of 18, which means that the portion of the debt that is about to be refinanced is above-average. It has more debt in the refinancing stage than 82% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 53 (better than 53% compared with alternatives), Expedia has a financing structure that is safer than that of its competitors. The refinancing issues could be a short-term problem, especially if the company has reputation issues. Banks and investors don't like to refinance debt if there are clouds on the horizon. For this reason, investors should look at the refinancing environment for Expedia. Does it look safe that debt that is coming due can be covered with new debt? If that is the case, then the financing situation of the company is on the safer side. If not, it may be better to wait until refinancing has been completed and the Refinancing rank is good again. ...read more
Combined financial peformance: Expedia Above-Average Financial Performance
| COMBINED PERFORMANCE | June 20, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 28 |
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| GROWTH | ||||||||
| GROWTH | 75 |
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| SAFETY | ||||||||
| SAFETY | 82 |
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| COMBINED | ||||||||
| COMBINED | 50 |
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ANALYSIS: With an Obermatt Combined Rank of 50 (better than 50% compared with investment alternatives), Expedia (Hotels, Resorts & Cruise Lines, USA) shares have above-average financial characteristics compared with similar stocks. Shares of Expedia are low in value (priced high) with a consolidated Value Rank of 28 (worse than 72% of alternatives). But they show above-average growth (Growth Rank of 75) and are safely financed (Safety Rank of 53, which means below-average debt burdens). ...read more
RECOMMENDATION: A Combined Rank of 50, is a buy recommendation based on Expedia's financial characteristics. Investors looking for growth and low financial risk may find this stock attractive. While the company Expedia exhibits low value (Obermatt Value Rank of 28), which means that the stock price is rather high, it also demonstrates above-average growth (Obermatt Growth Rank of 75). This is a typical case, as high-growth companies are often expensive. Good financing practices (Obermatt Safety Rank of 53) are a double-edged sword: if the company continues growing, low debt limits shareholder returns. But if the company increases its debt, it will also increase risk. In other words, this is an investment on the safer side, despite the above-average price (low value). ...read more
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