Yahoo Finance Why Did Expedia’s Stock Skyrocket after Its 1Q16 Results?
Expedia's 1Q16 Earnings Analysis: Outpacing Its Peers
1Q16 snapshot
Expedia (EXPE) released its first quarter 2016 results on April 29, 2016. The company beat analysts’ estimates on revenues and earnings. Plus, gross bookings saw tremendous growth.
Revenues increased by 38.7% to $1.9 billion. This was 5.6% higher than analyst estimates of $1.8 billion in revenue for 1Q16.
Expedia reported an adjusted profit of $13.5 million, which translates to earnings per share (or EPS) of $0.09 for the quarter. This was also higher than analyst estimates of a loss of $0.06 per share.
Stock movement
As a result, Expedia’s (EXPE) stock was up by 8.2% on the day that its results were released. This was close to the 9.6% rally that the stock witnessed after its 4Q15 results were released.
Expedia’s peers also gained on the same day. On April 29, 2016, Priceline (PCLN) was up by 2% and TripAdvisor (TRIP) was up by 1.6%. On the other hand, Ctrip.com (CTRP) was down by 3.2%.
The broader market, as tracked by the S&P 500 ETF (SPY), was down by 0.5% in the same period.
Series overview
In this series, we will look at Expedia’s 1Q16 performance. We will analyze its key metrics trend and also look at its management’s guidance for 2016. We will also check analyst estimates for EXPE, finally wrapping up the series with a discussion of its valuation multiple.
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