CCL Looks Like a Smarter Buy Than Tripadvisor Stock: Lower Valuation, Stronger Growth
CCL is Tripadvisor’s peer in Hotels, Resorts & Cruise Lines industry that has:
1) Lower valuation (P/OpInc) compared to Tripadvisor stock
2) But higher revenue and operating income growth
This disconnect between valuation and performance could mean that you are better off buying CCL stock vs. TRIP stock
That is one way to look at stocks. Trefis High Quality Portfolio evaluates much more, and is designed to reduce stock-specific risk while giving upside exposure.
- CCL Looks Smarter Buy Than Tripadvisor Stock
- TRIP Has Surged 30%, But Risks Loom Large
- Small Cap Stocks Trading At 52-Week High
- Better Bet Than Tripadvisor Stock: Pay Less To Get More From CCL
- Tripadvisor Stock Pops on Activist Interest, But Is It Worth Buying?
- Can Tripadvisor Break Its Earnings Slump?
Key Metrics Compared
| Metric | TRIP | CCL |
|---|---|---|
| P/OpInc* | 13.6x | 8.8x |
| LTM OpInc Growth | 1.7% | 26.8% |
| 3Y Avg OpInc Growth | 81.7% | 270.6% |
| LTM Revenue Growth | 3.0% | 7.1% |
| 3Y Avg Revenue Growth | 16.1% | 45.9% |
OpInc = Operating Income, P/OpInc = Price To Operating Income Ratio
But do these numbers tell the full story? Read Buy or Sell TRIP Stock to see if Tripadvisor still has an edge that holds up under the hood. As a quick background, Tripadvisor (TRIP) provides a platform with over 1 billion reviews and opinions on hotels, restaurants, experiences, airlines, and cruises across media, hotels, and dining segments.
This is just one approach to evaluate investments. Trefis High Quality Portfolio evaluates much more, and is designed to reduce stock-specific risk while giving upside exposure
Is The Mismatch In Stock Price Temporary
One way to check if Tripadvisor stock is expensive now versus the other tickers would be to see how these metrics compared across companies exactly a year ago. Specifically, if there has been a marked reversal in the trend for Tripadvisor in the last 12 months, then there is a chance that the current mismatch is likely to reverse. On the other hand, a persistent underperformance in revenue and operating income growth for Tripadvisor would reinforce the conclusion that the stock is expensive compared to its peers, but may not revert soon
Key Metrics Compared 1 Yr Prior
| Metric | TRIP | CCL |
|---|---|---|
| P/OpInc* | 17.3x | 6.3x |
| LTM OpInc Growth | -19.3% | 48.3% |
| 3Y Avg OpInc Growth | 93.0% | 140.2% |
| LTM Revenue Growth | 1.4% | 10.8% |
| 3Y Avg Revenue Growth | 22.8% | 81.1% |
OpInc = Operating Income
Additional Metrics To Consider
| Metric | TRIP | CCL |
|---|---|---|
| P/S | 1.0x | 1.4x |
| Market Cap (Current) | $ 1.9 Bil | $ 38.0 Bil |
| LTM Revenue | $ 1.87 Bil | $ 26.23 Bil |
| LTM Opinc | $ 142.70 Mil | $ 4.31 Bil |
| LTM Op Margin | 7.6% | 16.4% |
OpInc = Operating Income
Alternate buying based on valuation, while attractive, needs to be evaluated carefully from multiple angles. Such multi-factor analysis is exactly how we construct Trefis portfolio strategies. If you want upside with a smoother ride than an individual stock, consider the High Quality portfolio, which has outperformed the S&P, and clocked >91% returns since inception.