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On Friday, TD Cowen’s analyst Kevin Kopelman updated the firm’s outlook on Expedia Group Inc. (NASDAQ:EXPE), raising the price target from $176.00 to $215.00 while maintaining a Hold rating on the stock. The company, currently trading at $200.39 with a market capitalization of $25.64 billion, has shown remarkable momentum with a 52.39% price return over the past six months. According to InvestingPro analysis, the stock is trading slightly above its Fair Value. The adjustment follows Expedia’s fourth-quarter performance, which Kopelman noted "significantly exceeded expectations," with a notable increase in booked nights and gross booking value (GBV) driven by robust demand, December promotions, and business-to-business (B2B) strength. InvestingPro data reveals impressive gross profit margins of 89.19%, with additional ProTips highlighting strong operational efficiency (subscribers can access 10+ more exclusive insights).
Expedia’s fourth-quarter results showed an 11.6% increase in booked nights, compared to a 9% increase in the previous quarter. The GBV rose by 12.7%, a substantial jump from the 7% growth seen in the third quarter. The analyst attributed this growth to strong consumer demand, effective promotional activities in December, and the company’s B2B segment performance.
Despite a slowdown in the current quarter-to-date (QTD), Kopelman expects Expedia to maintain in-line top-line growth, with forecasts for 2025 indicating a 6-8% increase excluding foreign exchange impacts. Additionally, the analyst anticipates a 50 basis point improvement in 2025 margins, which could contribute approximately 2.5% to EBITDA growth based on a higher 2024 adjusted base. The company’s attractive PEG ratio of 0.62 suggests potential value relative to its growth prospects. Dive deeper into Expedia’s comprehensive financial analysis with InvestingPro’s detailed research report, part of our coverage of 1,400+ US stocks.
The raised expectations also factor in increased confidence following the fourth-quarter beat and the appointment of a new CFO. Kopelman has increased the 2025 EBITDA estimate by 4% and EPS estimate by 10%, citing lower stock-based compensation and tax rates. The new price target of $215.00 is based on an 18X multiple of the anticipated 2025 earnings per share.
In other recent news, analysts from various firms have updated their outlooks on Expedia. Benchmark analysts have increased their price target on Expedia shares from $200 to $225, maintaining a Buy rating. They highlighted the reinstatement of the company’s dividend and ongoing stock buyback program as positive developments. Meanwhile, Cantor Fitzgerald raised its price target from $180 to $210, retaining a neutral stance. The firm pointed to Expedia’s cost control and selective investment in marketing initiatives as reasons for the adjustment.
Mizuho (NYSE:MFG) Securities also updated its price target for Expedia, lifting it to $195 from $180, while maintaining a neutral rating. The firm noted Expedia’s room night growth and promising EBITDA margins as factors in this adjustment. Goldman Sachs increased its price target for Expedia to $241 from $236, highlighting strong gross bookings, revenue, and adjusted EBITDA in the company’s recent earnings report. Lastly, HSBC upgraded Expedia’s stock from Hold to Buy, raising its target to $215 from $195, based on an optimistic outlook for the company’s future financial performance. These are all recent developments that investors should consider when evaluating Expedia.
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