Post a CommentIt was a fairly slow week but things continue to go well so I certainly can’t complain. I’m considering closing my trade on EBAY & YHOO (currently up 28%) because of everything that’s going on with eBay these days (battle between the board and Carl Icahn) so stay tuned on that one:)
As will be the case all year, my long & short stock picks will be available to see in my live spreadsheet:
http://www.intelligentspeculator.net/livetrades
You can see the numbers for both companies involved in today’s trade here:
| Ticker | Name | Price | PE Ratio | PE Next Year | Return YTD | Sales Growth | Analyst rating | Book Value | Beta | Revenue/Share | Sales 5Y Avg Growth | Sales 5Y Avg Growth | EPS 5Y Avg Growth |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| EXPE | Expedia Inc | 78.53 | 37.57 | 17.69 | 12.73 | 18.38 | 3.64 | 16.54 | 1.15 | 35.37 | 13.37 | 11.18 | 16.23 |
| TZOO | Travelzoo Inc | 23.62 | 21.47 | 17.83 | 10.79 | 4.67 | 3.67 | 2.09 | 0.64 | 10.36 | 14.2 | 14.2 | N/A |
As you can see in the chart below, there is a significant difference in terms of growth between these two companies and that has been true for almost 2 years with no signs of an upcoming reversal.
EXPE Revenue (Quarterly YoY Growth) data by YCharts
Long Expedia (EXPE)
For some time, I had my doubts about Expedia and how it would perform once the spin-off of TripAdvisor was a done deal. It does certainly look like Expedia is doing very well. There are some other travel-related that I prefer (TRIP, PCLN) but this trade made a lot of sense to me given the fact that they are trading at virtually identical forward P/E ratios.
Next earnings release: May 1st 2014
Short Travelzoo (TZOO)
Travelzoo is a stock that I have not traded in some time and while it does seem to be picking up a bit of momentum after a big fall, I would personally stay away. From all the traffic metrics that I see as well as slower growth in revenues, I simply do not trust TZOO at its current valuation compared to other players.
Next earnings release: April 21 2014
Disclaimer: No positions on Expedia (EXPE) or Travelzoo (TZOO) but I will initiate the trade on the open today
