Citi sees three potential catalysts for Expedia (EXPE), none of which strikes us as particularly compelling:
- signs the U.S. leisure travel demand has stabilised [for a month or two–future TBD]
- signs the company is gaining share in Europe [but Europe is beginning to weaken]
- a possible major share buyback announcement
Citi seems to be happy with the chances any of those things actually happen. We wouldn’t bet on the U.S. consumer suddenly demanding airfares that have doubled, tripled and quadrupled amid a recession. Citi is looking long-term, but how long? As for the buyback, it will obviously depend on when and how much.
Citi reiterates its BUY rating for Expedia (EXPE).