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Why Is TripAdvisor (TRIP) Up 2.7% Since Last Earnings Report?
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It has been about a month since the last earnings report for TripAdvisor (TRIP - Free Report) . Shares have added about 2.7% in that time frame, underperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is TripAdvisor due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
TripAdvisor Q2 Earnings Beat, Rise Y/Y
TripAdvisor reported second-quarter 2024 non-GAAP earnings of 39 cents per share, which rose 15% from the prior-year quarter. The figure also beat the Zacks Consensus Estimate by 2.6%.
Revenues of $497 million increased 1% year over year. The figure missed the Zacks Consensus Estimate of $505.5 million.
Top-line growth was driven by the strong momentum in the Viator segment. A well-performing TheFork segment also benefited the company.
However, softness across Tripadvisor-branded hotels was concerning.
Quarterly Details
Brand Tripadvisor: Revenues summed $250 million (accounting for 50.3% of the total revenues) for the segment, down 10% year over year. The figure lagged the consensus mark of $264 million. Media and advertising revenues fell 2% year over year to $41 million. Revenues from experiences and dining were $48 million, decreasing 4% year over year. Revenues from branded hotels decreased 14% year over year to $150 million. Other revenues within the segment were $11 million, which declined 15% year over year.
Viator: The segment’s revenues totaled $244 million (49.1%). The figure increased 13% year over year and surpassed the Zacks Consensus Estimate of $240 million.
TheFork: Revenues for the segment came in at $42 million (8.4%), increasing 11% year over year. The figure came below the consensus mark of $43.6 million.
Operating Results
TripAdvisor’s selling and marketing costs decreased 3% year over year to $263 million. As a percentage of revenues, the figure contracted 200 basis points (bps) year over year.
General and administrative costs were up 19% from the year-ago quarter to $56 million. As a percentage of revenues, the figure expanded 100 bps year over year.
Technology and content costs of $75 million increased 6% on a year-over-year basis. As a percentage of revenues, the figure rose 100 bps year over year.
TRIP reported an operating margin of 7.2% in the quarter under review, which contracted 170 bps year over year.
In the reported quarter, the total adjusted EBITDA margin was 20%, which expanded 180 bps on a year-over-year basis.
Balance Sheet & Cash Flow
As of Jun 30, 2024, cash and cash equivalents were $1.18 billion compared with $1.17 billion as of Mar 31, 2024.
The long-term debt stood at $841 million at the end of the second quarter compared with the previous quarter’s $840 million.
Tripadvisor generated $53 million of cash from operations in the reported quarter, down from $139 million reported in the prior quarter.
The free cash flow was $37 million in the second quarter.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended downward during the past month.
The consensus estimate has shifted -36.4% due to these changes.
VGM Scores
Currently, TripAdvisor has an average Growth Score of C, though it is lagging a bit on the Momentum Score front with a D. However, the stock was allocated a grade of A on the value side, putting it in the top quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. It's no surprise TripAdvisor has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.
Performance of an Industry Player
TripAdvisor is part of the Zacks Internet - Commerce industry. Over the past month, Groupon (GRPN - Free Report) , a stock from the same industry, has gained 16.4%. The company reported its results for the quarter ended June 2024 more than a month ago.
Groupon reported revenues of $124.62 million in the last reported quarter, representing a year-over-year change of -3.5%. EPS of -$0.02 for the same period compares with -$0.10 a year ago.
Groupon is expected to post earnings of $0.14 per share for the current quarter, representing a year-over-year change of +216.7%. Over the last 30 days, the Zacks Consensus Estimate remained unchanged.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #1 (Strong Buy) for Groupon. Also, the stock has a VGM Score of A.
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Why Is TripAdvisor (TRIP) Up 2.7% Since Last Earnings Report?
It has been about a month since the last earnings report for TripAdvisor (TRIP - Free Report) . Shares have added about 2.7% in that time frame, underperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is TripAdvisor due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
TripAdvisor Q2 Earnings Beat, Rise Y/Y
TripAdvisor reported second-quarter 2024 non-GAAP earnings of 39 cents per share, which rose 15% from the prior-year quarter. The figure also beat the Zacks Consensus Estimate by 2.6%.
Revenues of $497 million increased 1% year over year. The figure missed the Zacks Consensus Estimate of $505.5 million.
Top-line growth was driven by the strong momentum in the Viator segment. A well-performing TheFork segment also benefited the company.
However, softness across Tripadvisor-branded hotels was concerning.
Quarterly Details
Brand Tripadvisor: Revenues summed $250 million (accounting for 50.3% of the total revenues) for the segment, down 10% year over year. The figure lagged the consensus mark of $264 million. Media and advertising revenues fell 2% year over year to $41 million. Revenues from experiences and dining were $48 million, decreasing 4% year over year. Revenues from branded hotels decreased 14% year over year to $150 million. Other revenues within the segment were $11 million, which declined 15% year over year.
Viator: The segment’s revenues totaled $244 million (49.1%). The figure increased 13% year over year and surpassed the Zacks Consensus Estimate of $240 million.
TheFork: Revenues for the segment came in at $42 million (8.4%), increasing 11% year over year. The figure came below the consensus mark of $43.6 million.
Operating Results
TripAdvisor’s selling and marketing costs decreased 3% year over year to $263 million. As a percentage of revenues, the figure contracted 200 basis points (bps) year over year.
General and administrative costs were up 19% from the year-ago quarter to $56 million. As a percentage of revenues, the figure expanded 100 bps year over year.
Technology and content costs of $75 million increased 6% on a year-over-year basis. As a percentage of revenues, the figure rose 100 bps year over year.
TRIP reported an operating margin of 7.2% in the quarter under review, which contracted 170 bps year over year.
In the reported quarter, the total adjusted EBITDA margin was 20%, which expanded 180 bps on a year-over-year basis.
Balance Sheet & Cash Flow
As of Jun 30, 2024, cash and cash equivalents were $1.18 billion compared with $1.17 billion as of Mar 31, 2024.
The long-term debt stood at $841 million at the end of the second quarter compared with the previous quarter’s $840 million.
Tripadvisor generated $53 million of cash from operations in the reported quarter, down from $139 million reported in the prior quarter.
The free cash flow was $37 million in the second quarter.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended downward during the past month.
The consensus estimate has shifted -36.4% due to these changes.
VGM Scores
Currently, TripAdvisor has an average Growth Score of C, though it is lagging a bit on the Momentum Score front with a D. However, the stock was allocated a grade of A on the value side, putting it in the top quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. It's no surprise TripAdvisor has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.
Performance of an Industry Player
TripAdvisor is part of the Zacks Internet - Commerce industry. Over the past month, Groupon (GRPN - Free Report) , a stock from the same industry, has gained 16.4%. The company reported its results for the quarter ended June 2024 more than a month ago.
Groupon reported revenues of $124.62 million in the last reported quarter, representing a year-over-year change of -3.5%. EPS of -$0.02 for the same period compares with -$0.10 a year ago.
Groupon is expected to post earnings of $0.14 per share for the current quarter, representing a year-over-year change of +216.7%. Over the last 30 days, the Zacks Consensus Estimate remained unchanged.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #1 (Strong Buy) for Groupon. Also, the stock has a VGM Score of A.