Bernstein lowered its rating on Tripadvisor (NASDAQ:TRIP) to Market Perform from Outperform with the online travel company’s shift to investment mode changing the firm’s outlook.
Analyst Richard Clarke said Tripadvisor laid a highly sensible strategic plan that includes focusing on the parts of the business that perform better. However, near-term results for Tripadvisor are expected to be impacted while the plan is set in motion, leading Clarke to reduce EBITDA estimates on the online travel stock for 2023 and 2024.
“This is going to be a steady multi-year roll-out and the end result seems more defensive than offensive with the aim of ‘long term steady profitable growth’, which is largely inline with the consensus view and below our previous expectations,” Clarke warned.
Bernstein cut its price target on Tripadvisor to $26.00
Elsewhere, Bank of America kept a Buy rating on TRIP following the earnings print.”We think the guide by a relatively new management is likely conservative and see upside to revenue with strong growth in Viator,” noted analyst Nat Schindler.
Revenue was up 47% year-over-year to $354 million and adjusted EBITDA rose almost 50% to $43 million as opposed to the $36 million consensus. The online travel service company narrowed its operating loss to -$3 million for the quarter. The solid performance for the year was attributed in part to Viator executing against strong demand in experiences, as well as solid performance in the hotel meta offering within the Tripadvisor Core segment.
TRIP shares were pelted $2.03, 8.1%, to $23.17