Why TRIP could be the play for 2023
Tripadvisor, Inc. (NASDAQ:TRIP) hasn't had the type of post-pandemic chart recovery many had anticipated. Down 35% year-to-date, is TRIP at an intruding entry point for contrarian investors?
Earlier this morning, Tripadvisor stock clocked an 18-month low of $17.43. TRIP is down 54.3% year-over-year, and hasn't traded above $20 since a mid-June post-earnings pullback. It's no surprise then, that analysts and short sellers are bearish; the majority of the brokerages rate TRIP a "hold" or "strong sell," while 11.5% of the equity's total available float is sold short.
The online travel company stock’s valuation continues to be high at a forward price-earnings ratio of 22.57 and a price-sales ratio of 2.43 despite TripAdvisor stock’s bearish form this past year. TRIP has also struggled to produce consistent top and bottom line growth in recent years, reporting a 3.4% decrease in revenues for fiscal 2019 and a 61.3% decrease for fiscal 2020. TripAdvisor also reported $289 million in net losses for fiscal 2020, which amounted to a $415 million decrease in comparison to fiscal 2019.
TRIP, however, is expected to end fiscal 2022 with $0.8 in EPS (earnings per share), which would mark a $1.1 increase in earnings compared to fiscal 2021. The online travel name also expected to grow earnings by a massive 57.4% for fiscal 2022, potentially setting up TripAdvisor stock for a strong recovery at the back end of the year or for 2023. In addition, TRIP is estimated to increase their revenues and earnings 18.7% and 111.3%, respectively, for fiscal 2023.