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Last week, you might have seen that Expedia Group, Inc. (NASDAQ:EXPE) released its first-quarter result to the market. The early response was not positive, with shares down 5.4% to US$157 in the past week. It was a pretty bad result overall; while revenues were in line with expectations at US$3.0b, statutory losses exploded to US$1.56 per share. 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.
Following the latest results, Expedia Group's 32 analysts are now forecasting revenues of US$14.1b in 2025. This would be a modest 2.5% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to expand 10% to US$10.14. Before this earnings report, the analysts had been forecasting revenues of US$14.4b and earnings per share (EPS) of US$10.76 in 2025. The analysts seem to have become a little more negative on the business after the latest results, given the minor downgrade to their earnings per share numbers for next year.
View our latest analysis for Expedia Group
The average price target fell 5.8% to US$190, with reduced earnings forecasts clearly tied to a lower valuation estimate. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. The most optimistic Expedia Group analyst has a price target of US$290 per share, while the most pessimistic values it at US$135. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.
Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. It's pretty clear that there is an expectation that Expedia Group's revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 3.4% growth on an annualised basis. This is compared to a historical growth rate of 15% over the past five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 9.8% annually. 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.