How Analysts See TripAdvisor in 2016 and Beyond



Analyst estimates

TripAdvisor’s (TRIP) sales are expected to grow by 7% in 3Q16 to $443.5 million and by 12% in 4Q16 to $345.5 million. For fiscal 2016, analysts expect TRIP’s sales to grow by 3% to ~$1.5 billion.

TRIP’s EBITDA (earnings before interest, tax, depreciation, and amortization) is expected to increase by 1% and 4% to $131 million and 90 million in 3Q16 and 4Q16, respectively. For fiscal 2016, the company’s EBITDA is expected to decline by 14% to ~$402 million.

It expects its EPS (earnings per share) to increase by 2.9% in 3Q16 and to decline again in 4Q16 by 23%. For fiscal 2016, it expects its EPS to decline by 21.7% to $1.6.

The company’s sales growth is expected to increase by 15% in both 2017 and 2018, thereby achieving sales of $1.8 billion and $2.1 billion, respectively. EBITDA growth is expected to accelerate to 26% in both 2017 and 2018 to ~$508 million and $640 million, respectively.

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Analyst recommendations

Of the 26 analysts rating TripAdvisor’s stock after the company’s 2Q16 earnings report, 15.4% (four analysts) issued “buy” ratings, 73.1% (19 analysts) issued “hold” ratings, and 11.3% (three analysts) issued “sell” ratings.

Target price

The consensus 12-month target for TRIP’s stock price is $64.82, which indicates a 1.9% return potential. The consensus target prices for other online travel players are as follows:

  • Priceline (PCLN) has a 12-month target price of $1510.7, with a return potential of 11.1%.
  • Expedia (EXPE) has a 12-month target price of $133.8, with a return potential of 17.9%.
  • Ctrip.com (CTRP) has a 12-month target price of $51.1, with a return potential of 18.9%.

Notably, TRIP makes up 1.6% of the NASDAQ-100 Ex-Technology Sector Index (QQXT).

In the next and final part of this series, we’ll discuss TRIP’s forward valuation multiples.


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