Expedia announced a CEO change late Thursday while beating earnings estimates for the fourth quarter. Expedia stock tanked below a key level Friday after hitting a 52-week high Thursday.
The online travel company's earnings release showed Q4 bookings came in slightly below Wall Street estimates. Outlook for the current first quarter also "suggests slower bookings growth to start 2024," Bank of America analysts wrote in a note to clients Friday. The analysts downgraded Expedia stock to neutral and lowered their price objective to $156 from $181, saying the travel firm "has a lot to work through" in the first half of 2024.
Ariane Gorin, the president of Expedia for business, will succeed Peter Kern as chief executive officer starting May 13, Expedia said in a separate news release late Thursday.
Expedia Earnings Growth Accelerates
Estimates: Analysts projected Expedia earnings of $1.67 per share, a 33% increase year over year. Revenue was expected to climb 9.7% to $2.873 billion, according to FactSet.
During the key holiday quarter, Wall Street predicted bookings grew 7.2% to $21.997 billion.
Results: Earnings of $1.72 a share, up 37% and accelerating from a 33.6% gain the prior quarter.
Revenue rose 10% to $2.887 billion. Gross bookings grew 6% to $21.672 billion.
Expedia Stock Dives Below Key Level
Shares of the online travel and booking site sank 17.8%, at 131.11, Friday. Expedia stock undercut the 50-day moving average in big volume. It rose 3.3% to 159.47 in Thursday's stock market trading.
Both Expedia and Booking.com are on the IBD Leaderboard watchlist.
Booking stock rose 3.5% to a record high Thursday. Shares fell 2.1% Friday, well above the 50-day line.
Amid a rebound in travel demand, Expedia stock jumped in the past year. It had plunged for much of 2022 due to travel headwinds, including the coronavirus omicron variant, the Ukraine war and inflation.
