Expedia Group
stock has more room to grow while
Airbnb
shares have limited upside following solid gains this year, according to an analyst at Evercore ISI.
Mark Mahaney upgraded shares of
Expedia
(ticker: EXPE) to Outperform from In Line and increased his price target on the stock to $200 from $135.
“EXPE’s revenue growth acceleration is being driven by a series of sustainable company initiatives and key development,” Mahaney wrote in a research note. These initiatives include improvements to online platforms and the launching of its One Key loyalty program, which gives loyalty rewards to users of several
Expedia
brands.
Earlier this month, Expedia reported third-quarter earnings and revenue above Wall Street’s estimates and said it continues to expect double-digit revenue growth for the year. One reason for the solid quarterly performance was that travel demand remains strong as consumers continue to spend on experiences.
Expedia was rising 3.5% Friday to $134.33. Coming into the session, shares have surged 52% this year.
Mahaney downgraded shares of
Airbnb
(ABNB) to In Line from Outperform but maintained his price target of $136.
“We find its relative risk-reward outlook less attractive than that of
EXPE, especially as ABNB has appreciated to within 8% of our $136 PT,” Mahaney said.
Airbnb shares also have had a solid year, with the stock climbing 47% amid solid travel demand. However, the company provided fourth-quarter financial estimates that were below Wall Street estimates earlier this month which negatively impacted the stock.
Management said on its earnings conference call Nov. 1, that it believed the economic and geopolitical environment was causing demand softness in the current quarter. Inflation and interest rates remain high while the war in the Middle East continues.
Shares of Airbnb were up 0.2% to $126.48.
Write to Angela Palumbo at [email protected]
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