Expedia (EXPE) Stock Forecast & Price Target

Expedia Group is experiencing strong growth, with third-quarter results showing an 8% increase in overall sales, driven by a notable 14% growth in hotel bookings and improving performance from Vrbo. The company's anticipated revenue and EBITDA growth rates of 7% and 8% respectively from 2024 to 2026 indicate a positive outlook, supported by better brand cohesion and an increasing mix of direct traffic. Additionally, the robust demand for international travel services and the recent surge in Vrbo bookings due to enhanced supply further solidify Expedia's favorable standing in the online travel agency market.

Expedia Group's reliance on a single business segment—lodging—which constitutes 80% of its total sales, poses significant risks given potential volatility in consumer preferences and spending behaviors, particularly amidst changing economic conditions. The company's high exposure to international markets, with 87% of its revenue generated from these regions, exposes it to foreign exchange fluctuations that can impact demand stability and overall financial performance. Additionally, increasing competitive pressure and elevated marketing costs, particularly in a crowded landscape with brands like Hotels.com and Vrbo, could strain EBITDA margins and hinder long-term profitability.