Expedia Inc (NASDAQ:EXPE) is a common name in the hotel and travel industry not just in the US, but also most parts of the globe. Its stock is gaining after seeing drop for few months last year.
Charles Payne of Fox Business was discussing about this recent rise in the stock price and how it might look for the coming few months. He said that the stock is doing well at the current price. Here is what he stated:
“Believe it or not, Expedia’s stock has hung in there pretty well with priceline. They are #1 in America, now they have their sight set on the Rest of the World”
The reason, according to Payne, for the drop of the stock price last year was the problems in execution and issues with hotwire.com. He said that Expedia Inc (NASDAQ:EXPE) has cleaned up on all the issues and looking pretty good currently. Payne also feels that the management seems really very confident to him.
Wall Street is hiking the estimates of the company which tells that the company is undervalued. Expedia Inc (NASDAQ:EXPE) has a market cap of over $10 billion with a P/E ratio of around 31 last year. The company is looking aggressively to get into mobile, China and also in corporate travel. Expedia Inc (NASDAQ:EXPE)’s Egencia which is a corporate travel management site is the 5th largest currently across the globe.
Payne said that the stock will see an out-sized growth which means an out-sized valuation due to the growth of Expedia Inc (NASDAQ:EXPE) in the international business. He said that the stock might see a fair amount of resistance at the $80 mark, however beyond that it could reach $90 fairly quickly. However his long term target for Expedia Inc (NASDAQ:EXPE) is $110.
Matt McCall, founder of Penn Financial Group however feels that to break the $80 target would be tougher one and he would wait until the stock crosses the first target. The reason according to McCall might be the 10% travel hike for the 4th of July. Here is what he said about Expedia Inc (NASDAQ:EXPE) crossing the $80 level:
“We just did that whole little lesson of resistance and as you just mentioned, if it breaks above that $80 level, I think it takes off so I am patient letting it break out first.”