Expedia Surges as Profit Tops Estimates on Hotel BookingsJames Callan
Expedia Inc. surged 14 percent after higher bookings helped the online travel service post fourth-quarter earnings that beat analysts’ estimates.
Expedia rose to $74.45 at the close in New York, the biggest gain since Oct. 31. Competitors TripAdvisor Inc. and Orbitz Worldwide Inc. also advanced, adding 9.5 percent and 4.2 percent, respectively.
Gross bookings jumped 21 percent in the quarter, driven by room night growth at Expedia’s eLong and Hotels.com brands, according to a statement yesterday. Expedia also benefited from an increase in air tickets as it vies with rivals, including Priceline.com Inc., for travelers seeking to book trips online.
“Total gross bookings growth could average in the mid-teens through 2014, with upside depending on how aggressive Expedia is acquiring hotel supply outside North America,” Daniel Kurnos, an analyst with Benchmark Co., said in a research note today.
Kurnos, who is based in Boca Raton, Florida, has a buy rating on the shares.
Adjusted earnings per share totaled 92 cents in the quarter at Expedia, which is based in Bellevue, Washington. Analysts projected 85 cents, the average of estimates compiled by Bloomberg. Revenue, helped by a 25 percent increase in hotel room night growth, jumped 18 percent to $1.15 billion.