This Expedia Analyst Is Buying The Dip

Shares of Expedia Group Inc EXPE gained more than 5% Friday after the online travel agency executed a series of corporate moves, including raising new capital.

The stock saw an upgrade by JMP Securities from Market Perform to Market Outperform with a $92 price target on the expectation that travel demand is likely to bottom in April.

The company solidified its balance sheet with a $4-billion debt and preferred equity raise, believing travel demand is likely at the trough in April, analyst Andrew Boone said in the upgrade note.

With cancellations exceeding new bookings near term, this is the trough of travel demand, but the timing of travel recovery remains unclear, the analyst said.

Expedia Has $8B Of Liquidity

Expedia has $8 billion-plus of liquidity that can see it through to a normalized travel environment, Boone said.

“Capital raise gives Expedia $8 billion + in cash & a year for travel to normalize. With its announced $3.95 billion capital raise and $4.1 billion of cash at the end of 1Q20, Expedia now has $8 billion + of liquidity that can see it through to a normalized travel environment.”