Expedia Hits Record After Profit, Sales Beat Estimates
Expedia shares rose to a record value since the company’s July 2005 spinoff from IAC/InterActive after second-quarter sales and profit topped analysts’ estimates.
Shares of the travel services website jumped to their highest closing price since becoming an independent company a decade ago, according to data compiled by Bloomberg.
"This is a reflection of some solid fundamentals in the business,” said Justin Patterson, an analyst at Raymond James Financial in San Francisco.
Patterson said the jump also may reflect increased confidence that the company’s purchase of Orbitz Worldwide will close without any issues.
The US-based company said in February that it was buying Orbitz for $1.6 billion including net debt and expected the acquisition to close in the second half of this year. There had been concern the deal might be blocked, but Patterson said recent reports suggest the US Department of Justice will allow it to proceed.
Expedia reported profit, excluding certain items, of 89 cents a share, compared with the 85-cent average analyst estimate. Revenue increased 11 percent to $1.66 billion, beating the $1.65 billion average of analysts’ estimates compiled by Bloomberg.
In May, Expedia sold its stake in ELong, a Chinese online travel company.
News by Bloomberg, edited by Hospitality Ireland