Tripadvisor is set to report its fiscal first-quarter results on May 8, with revenue and earnings expected to meet estimates. Liberty Tripadvisor Holdings has expressed interest in acquiring the company, which has boosted Tripadvisor’s stock price. Despite this, Tripadvisor has struggled in recent years due to competition from Google and a shift in audience preferences. The company’s Tripadvisor Core brand has shown only slight revenue growth, despite consistently high gross margins. Overall, Tripadvisor’s profits have been limited due to significant spending on sales and marketing.
Over the past three years, Tripadvisor’s stock has underperformed the S&P 500, with returns of -5% in 2021, -34% in 2022, and 20% in 2023. In contrast, the Trefis High Quality Portfolio has outperformed the market each year during the same period. As uncertainty looms with high oil prices and interest rates, investors are left wondering if Tripadvisor will continue to underperform or see a recovery in the next 12 months. Trefis’ valuation for Tripadvisor currently stands at $26 per share, aligning with the current market price.
Trefis anticipates Tripadvisor’s Q1 2024 revenues to reach around $395 million, in line with consensus estimates. The company’s Viator segment, which allows third parties to list bookable experiences on its platform, has been a significant contributor to revenue growth. Viator now accounts for 40% of total revenues and saw a 50% year-over-year increase to $737 million in fiscal 2023. Overall, Trefis projects Tripadvisor’s revenues to rise by 10% year-over-year to nearly $2 billion for the full year 2024.
Tripadvisor’s earnings per share for Q1 2024 are expected to match consensus estimates at 2 cents. The company’s net income for the full year was $10 million, with diluted EPS of $0.08 – a 42% decrease year-over-year. Tripadvisor has been investing heavily in marketing and technology development, particularly in the Viator and core Tripadvisor platforms. With an EPS estimate of $1.07 and a P/E multiple of 23.9x in fiscal 2024, Trefis projects a price of $26 per share, reflecting the current market price. Investors can find further analysis on Tripadvisor’s stock price compared to peers in the TRIP Peers section on Trefis.
