Expedia Group, Inc. Just Beat Earnings Expectations: Here's What Analysts Think Will Happen Next

It's been a pretty great week for Expedia Group, Inc. (NASDAQ:EXPE) shareholders, with its shares surging 13% to US$127 in the week since its latest quarterly results. It looks like a credible result overall - although revenues of US$3.6b were in line with what the analysts predicted, Expedia Group surprised by delivering a statutory profit of US$2.80 per share, a notable 18% above expectations. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

View our latest analysis for Expedia Group

Taking into account the latest results, the most recent consensus for Expedia Group from 30 analysts is for revenues of US$13.6b in 2024. If met, it would imply a modest 2.8% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to leap 37% to US$8.52. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$13.7b and earnings per share (EPS) of US$8.41 in 2024. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.

It will come as no surprise then, to learn that the consensus price target is largely unchanged at US$149. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. There are some variant perceptions on Expedia Group, with the most bullish analyst valuing it at US$200 and the most bearish at US$118 per share. As you can see, analysts are not all in agreement on the stock's future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Expedia Group's past performance and to peers in the same industry. We would highlight that Expedia Group's revenue growth is expected to slow, with the forecast 5.6% annualised growth rate until the end of 2024 being well below the historical 7.3% p.a. growth over the last five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 9.6% per year. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Expedia Group.

The Bottom Line

The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Expedia Group's revenue is expected to perform worse than the wider industry. The consensus price target held steady at US$149, with the latest estimates not enough to have an impact on their price targets.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have forecasts for Expedia Group going out to 2026, and you can see them free on our platform here.

We don't want to rain on the parade too much, but we did also find 2 warning signs for Expedia Group that you need to be mindful of.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.