Expedia (EXPE) Stock Forecast & Price Target

The positive outlook for Expedia Group's stock is supported by its guided EBITDA margin expansion of 50-100 basis points alongside projected revenue growth of 4-6%, indicating a strengthening financial position. Additionally, the company's performance in room nights has outpaced competitors, bolstered by a robust B2B sector and improving B2C trends, which reflects effective marketing leverage and enhanced operational efficiency. Furthermore, notable improvements in global site traffic and a 6-point improvement in revenue per booking for Vrbo signal a favorable trajectory for earnings per share growth, expected to exceed that of other online travel agency peers in the coming years.

Expedia Group faces a negative outlook primarily due to declining market share and increased competition, specifically from Booking Holdings which is expanding into lower-margin segments like air travel, potentially impacting Expedia's profitability. The company's EBITDA margins have been under pressure in its core hotel business, largely due to rising sales and marketing expenses, which are not expected to recover in the near term. Additionally, volatility in revenue per room night trends and potential regulatory challenges from the EU could further hinder Expedia's operational capabilities and financial performance, contributing to a pessimistic assessment of its future growth prospects.