Why Did SunTrust Robinson Upgrade TripAdvisor Inc’s Stock?


SunTrust Robinson analyst Naved Khan upgraded TripAdvisor Inc (TRIP) to Buy today and set a price target of $60. The company’s shares closed yesterday at $46.31, close to its 52-week low of $42.01.

Khan wrote:

“We forecast Hotel/Media Platform revs growth can sustain a low single-digit pace. We believe the company can achieve this through stabilization of core Hotels in 2H/2020 (as it benefits from lapping of ad cuts, funnel improvements, monetization gains, etc). This should be further supported by double-digit growth in Hotel display ad revs over the near/medium term (see pg 7). Bullish on Experiences/Dining (‘Experiences’). We believe that this fast growing segment (30% of revs) has yet to be fully reflected in the stock’s valuation. This is understandable given the historical importance of hotels to TRIP and lack of public comps for Experiences. Importantly, we believe LT margins in this segment can be comparable to the core, with consolidated adj. EBITDA margin in the 34%-41% range vs ~9% this year, by our ests (see pg 6).”

According to TipRanks.com, Khan is a 5-star analyst with an average return of 21.2% and a 71.6% success rate. Khan covers the Technology sector, focusing on stocks such as Endurance International, Wix.com Ltd, and trivago NV.

The word on The Street in general, suggests a Hold analyst consensus rating for TripAdvisor Inc with a $57.73 average price target.

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TripAdvisor Inc’s market cap is currently $6.44B and has a P/E ratio of 48.54. The company has a Price to Book ratio of 4.27.

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TripAdvisor, Inc. is an online travel company, which owns and operates a portfolio of online travel brands. It operates its business through the Hotel and Non-Hotel segments.

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