Key Takeaways:
- Expedia Group is driving the digital transformation of travel through its comprehensive portfolio of consumer brands, B2B solutions, and advertising services across lodging, flights, vacation rentals, and activities worldwide.
- EXPE stock could reasonably reach $257/share by the end of 2027, based on our valuation assumptions.
- This implies a total return of 37% from today’s price of $188/share, with an annualized return of 14.1% over the next 2.4 years.
Expedia (EXPE) has established itself as a diversified travel technology leader serving both consumers and business partners through its multi-brand platform, including Expedia, Hotels.com, and Vrbo.
The travel platform combines direct consumer relationships with a rapidly growing B2B business that powers travel for corporate clients, offline retailers, and loyalty programs globally.
Through a strategic focus on three core priorities, which include delivering more value for travelers, investing in high-growth opportunities, and driving operating efficiencies, Expedia has built sustainable competitive advantages.
The company leverages artificial intelligence across all functions while maintaining market-leading positions in key travel segments with barriers to entry.
EXPE stock benefits from its dominant B2B business, achieving 16 consecutive quarters of double-digit growth, expanding advertising revenue reaching record partner levels, and AI-powered innovations driving higher conversion rates and operational efficiencies.
Its diversified geographic exposure and growing international presence provide additional growth catalysts.
With solid Q2 results showing 6% revenue growth at $3.8 billion despite soft U.S. travel demand and raised full-year guidance reflecting improving trends, EXPE stock demonstrates resilient execution while building scalable technology platforms for long-term value creation in the travel digitization transformation.
Here’s why EXPE stock could return 14% annually through 2027 as the company capitalizes on travel recovery trends and leverages AI to expand margins while growing market share across consumer and B2B segments.
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What the Model Says for EXPE Stock
We analyzed the upside potential for EXPE stock using valuation assumptions based on the company’s strategic positioning and recovery trajectory.
Analysts see a meaningful opportunity ahead for Expedia, given its diversified business model with high-growth B2B and advertising segments, successful AI implementation driving operational improvements, and potential for margin expansion as travel demand normalizes and the company achieves greater marketing leverage.
Based on estimates of 6.0% annual revenue growth, 14.2% operating margins, and normalized valuation multiples, the model projects EXPE stock could rise from $188/share to $257/share.
That represents a 37% total return and a 14% annualized return over the next 2.4 years.
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Our Valuation Assumptions
TIKR’s Valuation Model lets you plug in your own assumptions for a company’s revenue growth, operating margins, and P/E multiple, and calculates the stock’s expected returns.
Here’s what we used for EXPE stock:
1. Revenue Growth: 6.0%
Expedia delivered steady Q2 results with revenue growth of 6% year-over-year despite challenging U.S. travel conditions.
Growth was driven by strong B2B performance (+17% bookings growth for the 16th consecutive quarter of double-digit expansion) and robust advertising revenue (+19%).
We used a 6.0% forecast reflecting Expedia’s balanced approach to growth during travel market recovery.
The company’s diversified business model, strong international exposure, and technology investments position it to capture upside as travel demand normalizes while maintaining disciplined execution.
2. Operating Margins: 14%
Expedia demonstrates margin expansion potential with Q2 adjusted EBITDA margins of 24%, up nearly two points year-over-year.
It achieved this expansion despite challenging market conditions through disciplined cost management and operational leverage.
Expedia’s focus on AI-powered productivity improvements, marketing leverage in the B2C business, and continued B2B growth at higher margins creates a clear path to sustainable margin expansion as revenue scales and operational efficiencies compound.
3. Exit P/E Multiple: 11.3x
EXPE stock trades at reasonable multiples for a leading online travel platform with diversified revenue streams, proven execution through market cycles, and clear competitive advantages in both consumer and B2B markets.
We maintain current valuation levels given Expedia’s balanced growth profile, strong cash generation capabilities, and strategic positioning to benefit from long-term travel industry digitization trends while delivering consistent shareholder returns through share repurchases.
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What Happens If Things Go Better or Worse?
Different scenarios for Expedia stock through 2030 show varied outcomes based on travel recovery pace and competitive execution: (these are estimates, not guaranteed returns):
- Low Case: Slower travel recovery and competitive pressure → 10% annual returns
- Mid Case: Successful AI implementation and margin expansion → 17% annual returns
- High Case: Strong travel rebound and B2B market leadership → 24%+ annual returns
Even in the conservative case, EXPE stock offers attractive returns supported by its diversified business model and strong competitive positioning.
The upside scenario for Expedia stock could deliver superior performance if travel demand accelerates and the company achieves significant marketing leverage while expanding B2B market share.
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
