Nomura Securities Maintains a 'Neutral' on TripAdvisor (TRIP); Strong Performer Y-T-D, But Not Today
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Price: $10.17 -5.31%
Rating Summary:
9 Buy, 31 Hold, 9 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 12 | Down: 23 | New: 22
Rating Summary:
9 Buy, 31 Hold, 9 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 12 | Down: 23 | New: 22
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Nomura Securities maintains a 'Neutral' on TripAdvisor (NASDAQ: TRIP) price target of $40.00 (from $46.00).
Analyst, Brian Nowak, said, "Last night TripAdvisor reported 2Q:12 revenue of 197mn, 6% (or $12mn) below us and 3% below the Street. Non-GAAP EPS came in at $0.41, 7% (or $0.03) below us, but in-line with consensus. The revenue miss was front and center as TRIP’s 2Q revenue came in light due largely to a previously un-announced strategic change (that started in April) to improve the quality of the site’s traffic. TRIP has been a strong performer in 2012, but as we have noted, 47% of the company’s performance year-to-date has been due to multiple expansion as TRIP rose to nearly twice the S&P 500 earnings multiple. This in part has been driven by expectations for continued outsized top-line growth, operating leverage and margin expansion. While these strategic changes may eventually lead to a higher client advertising ROI and therefore a larger share of advertising dollars, in the near term they create incremental top-line uncertainty. As such, we are reducing our target relative multiple by 10% (to 180% relative multiple) and our price target."
For an analyst ratings summary and ratings history on TripAdvisor click here. For more ratings news on TripAdvisor click here.
Shares of TripAdvisor closed at $43.47 yesterday.
Analyst, Brian Nowak, said, "Last night TripAdvisor reported 2Q:12 revenue of 197mn, 6% (or $12mn) below us and 3% below the Street. Non-GAAP EPS came in at $0.41, 7% (or $0.03) below us, but in-line with consensus. The revenue miss was front and center as TRIP’s 2Q revenue came in light due largely to a previously un-announced strategic change (that started in April) to improve the quality of the site’s traffic. TRIP has been a strong performer in 2012, but as we have noted, 47% of the company’s performance year-to-date has been due to multiple expansion as TRIP rose to nearly twice the S&P 500 earnings multiple. This in part has been driven by expectations for continued outsized top-line growth, operating leverage and margin expansion. While these strategic changes may eventually lead to a higher client advertising ROI and therefore a larger share of advertising dollars, in the near term they create incremental top-line uncertainty. As such, we are reducing our target relative multiple by 10% (to 180% relative multiple) and our price target."
For an analyst ratings summary and ratings history on TripAdvisor click here. For more ratings news on TripAdvisor click here.
Shares of TripAdvisor closed at $43.47 yesterday.
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