Expedia stock target cut to $174 by DA Davidson post 1Q results

On Monday, DA Davidson’s analysis of Expedia Group Inc. (NASDAQ:EXPE) led to a reduction in the company’s price target from $205.00 to $174.00, while the firm maintained a Neutral rating on the stock. According to InvestingPro data, 12 analysts have recently revised their earnings estimates downward, with price targets ranging from $135 to $290, reflecting mixed market sentiment. The company’s current market capitalization stands at $21.2 billion. The adjustment follows Expedia’s first-quarter results, which showed gross bookings and revenues slightly below consensus, at the lower end of the company’s own guidance. While revenue growth reached 5.57% in the last twelve months, the results were affected by a dip in travel demand within and into the United States. InvestingPro analysis suggests the stock is currently trading below its Fair Value, with additional insights available in the comprehensive Pro Research Report covering this leading travel company.

Expedia also revised its full-year growth expectations, now forecasting a 2-4% increase in gross bookings compared to the previously anticipated 4-6%. Despite the subdued growth outlook, Expedia’s disciplined cost management and recent workforce reductions contributed to a robust EBITDA performance in the second quarter, reaching $1.838 billion over the last twelve months. The company maintains impressive gross profit margins of 89.54%, demonstrating strong operational efficiency.

Management at Expedia is confident that these measures will enable the company to achieve a margin expansion of 75-100 basis points over the full year, which is an improvement over the initial forecast of 50 basis points. This reassessment of financial targets comes as the travel industry faces varying demand patterns, particularly in the U.S. market. Trading at a P/E ratio of 18.68, the stock shows attractive valuation metrics relative to its growth potential.

The revised price target reflects the analyst’s perspective on the company’s performance and expectations in the current travel environment. Expedia’s ability to surpass EBITDA predictions in the second quarter, despite a challenging quarter in terms of gross bookings and revenue, indicates a focus on operational efficiency and cost control.

Expedia’s management remains focused on long-term growth and profitability, as evidenced by the company’s strategic adjustments to its full-year guidance. The travel company continues to navigate through a period marked by fluctuating demand, with an eye on improving its financial margins.

In other recent news, Expedia Group Inc. has experienced several updates regarding its financial performance and analyst ratings. The company reported mixed results in its recent earnings, with a modest shortfall in top-line growth. Despite this, Expedia’s EBITDA exceeded forecasts, aided by cost-saving measures, leading to an upward revision of its fiscal year 2026 EBITDA forecast by 6%. However, the company has revised its revenue and gross bookings projections downward, reflecting uncertainties in the domestic travel sector.

Several analysts have adjusted their price targets for Expedia. Benchmark reduced its target to $215 while maintaining a Buy rating, citing the company’s mixed financial results and strategic outlook. Cantor Fitzgerald raised its target to $170, keeping a Neutral rating, acknowledging improved margins despite weak U.S. demand. TD Cowen also set a target of $170, maintaining a Hold rating, after noting a modest shortfall in gross bookings. Additionally, Citi lowered its target to $177, maintaining a Neutral rating, due to a noticeable slowdown in U.S. travel demand affecting Expedia’s bookings.

Goldman Sachs made a more drastic adjustment, cutting its target to $5, with a Neutral rating, reflecting a cautious approach amid changes in the broader economic environment. These recent developments indicate a varied outlook among analysts, with a focus on Expedia’s strategic adjustments and market conditions.

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