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TripAdvisor Rides on Mobile Growth & Global Market Expansion

On Jul 16, we issued an updated research report on TripAdvisor, Inc. TRIP.

TripAdvisor is witnessing secular growth trends in the online travel space. The company's solid performance in the non-hotel business, expansion into the international restaurant reservation space, new partnerships, better cost control and favorable foreign currency are positives. Additionally, TripAdvisor’s increasing interest in the food delivery space will add to top-line growth.

TripAdvisor’s stock has gained 56.2% in the past 12 months, outperforming the 44.4% rally of the industry it belongs to.

Key Factors

TripAdvisor continues to benefit from its rapidly expanding user base. Its rich content helps travelers choose from more than 1.5 million places, thus increasing the user base. TripAdvisor’s business model is primarily driven by the number of unique visitors to its website and therefore an increase in the number of visitors is an important indicator of its future growth.

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The company’s focus on food delivery space is a big positive. Recently, TripAdvisor added another food-delivery service, delivery.com, to its offerings. It entered into a partnership with delivery.com to incorporate food-ordering service into its restaurant listings. The tie-up will help travelers order meals from restaurants directly from TripAdvisor's desktop or mobile platform. The recent deal will help TripAdvisor further expand its user base.

TripAdvisor’s Instant Booking initiative is gaining a lot of momentum. The initiative allows travelers to book a hotel through TripAdvisor’s booking partners on its mobile site or apps.These initiatives will boost the world’s largest online travel research company’s user base and conversion rates as users are now more likely to click on advertisers’ links for booking rather than gathering information.

Additionally, TripAdvisor’s Mobile Platform continues to perform well and the company is constantly updating its mobile products. As a result, mobile traffic has been increasing at a healthy rate. Nowadays, smartphones are increasingly being used, along with laptops and tablets to share travel experiences through social networking sites. This is driving substantial traffic and commerce activity for travel sites.

Positive Earnings Surprise History: TripAdvisor has an impressive earnings surprise history. The company outpaced the Zacks Consensus Estimate in three of the trailing four quarters, delivering an average positive earnings surprise of 15.01%.

TripAdvisor, Inc. Price and Consensus

 

TripAdvisor, Inc. Price and Consensus | TripAdvisor, Inc. Quote

Zacks Rank and Other Stocks to Consider

TripAdvisor currently sports a Zacks Rank #1 (Strong Buy). Other top-ranked stocks in the same industry include Groupon GRPN, IAC/InterActiveCorp IAC and Ctrip.com International, Ltd. CTRP. While Groupon and IAC/InterActiveCorp sport a Zacks Rank #1, Ctrip.com holds a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Long-term earnings growth for Groupon, IAC/InterActiveCorp and Ctrip.com is currently projected to be 3%, 7.5% and 16%, respectively.

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Groupon, Inc. (GRPN) : Free Stock Analysis Report
 
TripAdvisor, Inc. (TRIP) : Free Stock Analysis Report
 
IAC/InterActiveCorp (IAC) : Free Stock Analysis Report
 
Ctrip.com International, Ltd. (CTRP) : Free Stock Analysis Report
 
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