EXPE - Expedia Group Q1: Revenue Performance Encouraging But VRBO Concern Remains

2024-05-09 15:29:25 ET

Summary

• Expedia Group stock has declined by over 12% since February.
• Concern over VRBO performance remains.
• However, growth in B2B revenue remains impressive.
• The stock could potentially be undervalued given a lower P/E ratio and continued earnings growth.

Investment Thesis: I take a long-term bullish view on the stock, but concern over underperformance of VRBO and Hotels.com remains and investors may need to be patient before we see a meaningful recovery from here. In this regard, my updated view on the stock is that in spite of an attractive P/E ratio and continued growth in revenue across the B2B segment - a recovery in the stock is more dependent on VRBO and Hotels.com performance than I had initially anticipated....

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