Reuters: Global Markets: Investors dump Expedia as competition hurts results

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Investors dump Expedia as competition hurts results Jul 26th 2013, 17:13 Fri Jul 26, 2013 1:13pm EDT (Reuters) - Expedia Inc's (EXPE.O) dismal results sparked a sell-off that wiped more than $2 billion off the online travel agency's market value and prompted at least nine brokerages to cut their price targets on the stock. Expedia reported a profit far short of Wall Street estimates for the second quarter on Thursday, hit by rising competition in its home market and poor performance in its discount travel website Hotwire.com. Analysts at RBC Capital Markets, JP Morgan, Benchmark Co, Jefferies, Cantor Fitzgerald and Cowen and Co reduced their price targets on Expedia's stock by as much as $10. Barclays Capital cut its price target by $15 to $57. Investors are fleeing the company's stock after pushing it to a record high of $68.09 in February, riding on Expedia's rapid growth in the United States through 2012. However, the company is now struggling to retain market share as rivals such as Priceline Com Inc (PCLN.O) ramp up domestic advertising of their brands. TripAdvisor Inc's (TRIP.O) shift away from pop-up ads, which led customers to its former parent's websites, also hit Expedia. TripAdvisor reported a better-than-expected quarterly profit on Wednesday and said it was stepping up advertising on TV and in print, which have traditionally been Expedia's strongholds. Expedia's shares were down 25 percent at $48.45 on Friday afternoon on the New York Stock Exchange. About 20 million shares changed hands by 1300 ET, almost eight times its 50-day moving average. The stock was one of the top percentage losers on the Nasdaq. (Reporting by Sagarika Jaisinghani and Mridhula Raghavan in Bangalore; Editing by Don Sebastian) Link this Share this Digg this Email Reprints

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