Wedbush Securities on Tuesday initiated coverage on multiple stocks in the Online Travel and Mobility sector, signaling potential upside for all of them, with Booking Holdings Inc BKNG being assigned to the Wedbush Best Ideas List.
The Wedbush Analyst: Scott Devitt initiated coverage on the following stocks, with respective price targets.
- Booking Holdings: Outperform rating, $3,060 price target.
- Uber Technologies Inc UBER: Outperform rating, $46 price target
- Airbnb Inc ABNB: Neutral rating, $130 price target
- Clear Secure Inc YOU: Neutral rating, $27 price target
- DoorDash Inc DASH Neutral rating, $75 price target
- Expedia Group Inc EXPE: Neutral rating, $116 price target
- LYFT Inc LYFT: Neutral rating, $10 price target
His ratings came at a time when post-COVID-19 pandemic recovery, high demand and spending trends are driving the industry, the analyst said in a Tuesday note to investors.
On Booking, Devitt said despite the turbulence of the industry, the company maintains a robust position as the leading online travel agency worldwide, anticipating more than 1 billion room nights through its platform in 2023.
Booking's strong points include a leading competitive position, strong margins, substantial free cash flow generation, diversified geographic mix and disciplined capital allocation with $22 billion remaining for repurchases.
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For Uber, Wedbush said the company was primed for sustainable long-term growth with catalysts including deeper international penetration, vertical expansion into grocery and retail, and cross-selling opportunities, reinforced by Uber One, the company’s membership program.
Airbnb, while having strong long-term growth potential, was seen as a more cautious bet given its unique exposure to longer stays, alternative accommodation, and lower-density non-urban stays during the pandemic, which may decrease in a return to normalcy.
On CLEAR, DoorDash, Expedia and Lyft, Devitt said while the companies have potential, future normalization risks and specific industry dynamics demand a more careful approach.
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