Citizens reiterated its Market Perform rating on Expedia Group (NASDAQ: EXPE) in a research note released Wednesday, affirming a neutral stance on the travel company's shares even as the business reports notable operational improvements. Expedia is currently valued at $28.73 billion and has produced a 40.29% total return over the past year amid recent market volatility.
Operational execution and product developments
In its note, Citizens highlighted what it calls "meaningfully improved" execution across Expedia's strategic priorities. The firm pointed to advances in delivering differentiated customer value through personalized, AI-driven features, broader rollout of property-funded promotions and rising adoption of loyalty programs. Citizens tied this operational progress to Expedia's strong financial indicators, noting a perfect Piotroski Score of 9 as reported in InvestingPro data, which the research firm interprets as evidence of financial strength.
Citizens also observed continued expansion in Expedia's B2B and advertising segments, and cited improved marketing efficiency within the B2C business as a driver of expanding margins. Those mixed revenue streams and margin dynamics underpin the firm's view that Expedia has been strengthening its commercial footing across multiple channels.
Valuation and distribution risks
Despite these positive signals, Citizens expressed caution related to potential shifts in travel distribution that could be driven by AI-enabled search and booking experiences. The research note specifically flagged Expedia's relatively higher domestic exposure and its greater reliance on branded hotel inventory as areas that could leave the company more exposed to distribution changes compared with some peers.
Bringing the analysis to valuation, Citizens concluded that Expedia shares appear fairly valued at 7.4x 2027E EBITDA, a multiple that supports the firm’s Market Perform rating on the stock.
Recent analyst and corporate activity
The research note also referenced a number of other recent analyst actions and company moves. Expedia announced the acquisition of Tiqets, an Amsterdam-based platform focused on activities and experiences, a deal consistent with the company’s strategy to broaden its travel offerings.
Several brokerages have recently adjusted targets and ratings: Goldman Sachs raised its price target to $325 while maintaining a Buy rating; BTIG increased its target to $330 and kept a Buy rating, calling out healthy near-term trends and potential upside to fourth-quarter estimates; Bernstein reiterated a Market Perform rating with a $256 price target, noting that Expedia’s third-quarter results beat consensus Gross Bookings by over 5% while managing marketing costs effectively; and DA Davidson maintained a Neutral rating with a $294 price target after the Tiqets acquisition. Bernstein also discussed the possibility of AI-powered travel search creating challenges for online travel agencies, while outlining a potential bull case for the industry despite recent share declines.
Bottom line
Citizens' reconfirmation of a Market Perform rating encapsulates a view that, although Expedia has strengthened execution across several strategic fronts and demonstrated favorable financial metrics, valuation and exposure to distribution changes driven by AI warrant a neutral stance. The firm’s 7.4x 2027E EBITDA valuation is central to that conclusion.