Expedia Inc., (NASDAQ:EXPE) has a gloomy outlook after posting a disappointing quarter earnings.
Denver, CO, 07/29/2013 (Avauncer.com) – Shares of Expedia Inc., (NASDAQ:EXPE) fell 27.38% to close at $47.20 in its last trading session. Shares were at the lower end of its 52-week price range of $47.09 to $68.09. Shares remained heavily traded with 28.26 million shares exchanging hands, as against an average volume of 2.19 million shares. The stock is on a new low for the year, due to its disappointing quarterly earnings.
This was despite the company announcing a quarterly dividend on Thursday, July 25th. The record date for such a dividend shall be August 28th. This results in a meager dividend yield of 0.92%. The company had earlier reported its quarter earnings on July 25th, which too was a disappointment. It reported an EPS of $0.64, way below the analyst estimate of $0.79. This is the reason of company announcing a meager dividend for its shareholders. The company had in the same quarter in the previous year posted an EPS of $0.76. However, the company’s revenue for the quarter had been up by 15.9% on a year on year basis. This too was below the market expectation of $1.26 billion. Despite this, the company had a declining EPS, meaning that the company lost on the grounds of cost control, whose cost overrun could offset the gains it made in increasing its revenue.
The plus point with the stock is that at current valuations, it now qualifies as a growth stock. Investors have high confidence of its business moving forward, by increasing profitability more rapidly. The company should now eye on promoting its brand, with more and more travelers opting to plan their travel through its site. It is only then can the company aim at returning to its old fortunes, by regaining its market share.
The company is now expected to post $3.32 EPS for the current fiscal year.