U.S. markets closed
  • S&P 500

    3,849.62
    -5.74 (-0.15%)
     
  • Dow 30

    30,937.04
    -22.96 (-0.07%)
     
  • Nasdaq

    13,626.06
    -9.93 (-0.07%)
     
  • Russell 2000

    2,149.86
    -13.42 (-0.62%)
     
  • Crude Oil

    52.75
    -0.02 (-0.04%)
     
  • Gold

    1,849.40
    -1.50 (-0.08%)
     
  • Silver

    25.52
    -0.01 (-0.05%)
     
  • EUR/USD

    1.2167
    +0.0022 (+0.18%)
     
  • 10-Yr Bond

    1.0400
    0.0000 (0.00%)
     
  • GBP/USD

    1.3733
    +0.0058 (+0.42%)
     
  • USD/JPY

    103.6240
    -0.1320 (-0.13%)
     
  • BTC-USD

    32,335.24
    +293.80 (+0.92%)
     
  • CMC Crypto 200

    652.54
    +5.22 (+0.81%)
     
  • FTSE 100

    6,654.01
    +15.16 (+0.23%)
     
  • Nikkei 225

    28,546.18
    -276.11 (-0.96%)
     

BofA Turns Bullish On Expedia Ahead Of Travel Recovery

Jayson Derrick
·1 min read

E-commerce and online media companies benefited from multiple expansions throughout 2020 and online travel agency stocks should benefit from similar trends in 2021, according to BofA Securities.

The Analyst: Justin Post upgraded Expedia from Neutral to Buy with a price target lifted from $132 to $153.

The Thesis: Investor attention will likely shift away from e-commerce stocks that will likely see decelerated growth in 2021, while OTA stocks should benefit from a rebound in travel booking in the back half of the year, Post said in an upgrade note.

While a full travel recovery will take time, the Street is willing to look forward to strong travel years in 2022 and 2023, the analyst said. 

Investors looking for exposure to the OTA group may want to consider Expedia Group Inc (NASDAQ: EXPE) over its peers including Booking Holdings Inc (NASDAQ: BKNG) for three reasons, he said: 

Related Link: Online Travel Agencies No Longer 'Growth Disruptors': Bernstein

1. Expedia's recent cost-cutting initiatives will translate to $1 billion in cost cuts and push its EBITDA margins to the high-20s versus 18% in 2019.

2. A cheaper valuation with the core Expedia business trading at three times EBITDA.

3. Upside potential of 78% for Expedia's stock versus a 37% potential gain for Booking.

EXPE Price Action: Shares of Expedia were trading down 0.78% at $131.37. 

Latest Ratings for EXPE

Date

Firm

Action

From

To

Jan 2021

B of A Securities

Upgrades

Neutral

Buy

Dec 2020

Citigroup

Downgrades

Buy

Neutral

Dec 2020

Bernstein

Initiates Coverage On

Market Perform

View More Analyst Ratings for EXPE
View the Latest Analyst Ratings

See more from Benzinga

© 2021 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.