Expedia (EXPE) Stock Forecast & Price Target

Expedia Group has provided guidance indicating an anticipated EBITDA margin expansion of 50-100 basis points alongside a revenue increase of 4-6%, signaling a positive trajectory for financial performance. Notably, improvements in its core brands, particularly Hotels.com and Vrbo—which together account for over 20% of global bookings—could significantly enhance consolidated growth, potentially reaching the high end of the company's 5-7% growth range for the third quarter. Additionally, there has been a positive trend in site traffic and U.S. receipt sales, with quarter-to-date sales showing a 3-4% increase, further reinforcing a favorable outlook for the company's financial health.

Expedia Group faces a negative outlook primarily due to a decline in U.S. Business-to-Consumer (B2C) bookings, which fell between 1-3% in the second quarter, raising concerns about the sustainability of its consolidated growth trajectory. The company's reliance on B2B growth, projected to soften from double digits to low double digits, further exacerbates these concerns, as it could lead to a slowdown in overall growth rates to low single digits. Additionally, the poor performance of its Hotels.com and Vrbo brands, which experienced mid-single-digit declines, contributed to a significant year-over-year revenue drop of nearly 10%, underscoring ongoing challenges within its key segments.