Web Reservations International (Hostelworld, Hostels.com) Up for Sale

Granted this article is from a year ago but I think you can probably discount these as buyers unless it was shares and a little bit of cash.

http://blogs.barrons.com/techtraderdaily/2008/10/31/travel-trouble-expedias-woes-pressure-orbitz-priceline/

This is actually interesting. Let´s see what the analyst´s predictions from one year ago were actually worth.

Predictions for Expedia:

This morning, several analysts cut ratings on the stock. Citigroup’s Mark Mahaney lowered his view to Hold from Buy, and chopped his price target to $12 from $29. He trimmed his 2008 EPS estimate to $1.28, from $1.37, and cut 2009 to $1.29 from $1.55. Mahaney notes current conditions do not support multiple expansion - and that the company is not likely to buy back stop for the foreseeable future.

Meanwhile, Bank of America’s Brian Fitzgerald and Brian Pitz lowered their rating to Neutral from Buy, while cutting their price target to $12 from $19. They cited a “belief that the global slowdown in travel is likely to significantly worse than expected, along with worse than expected currency headwinds.”

See here what happened.

For the short run, it would have been a good idea not to "hold", but to sell. The price of the Expedia stock went down to $ 6.05 on November 20 - just a few weeks after the prediction was made. Now, it´s back to $ 27, close to its all-time record of 2007. People who had Expedia stock quadrupled their assets since April - in 6 months! Hence, there would be enough cash around to buy HW. A takeover of a cool niche market monopolist would make the analysts ejaculate in their cubicles.

Citing similar reasons, the Bank of America analysts also cut their rating on Priceline (PCLN) to Neutral from Buy, chopping their target to $60 from $90.

Totally wrong. The price of Priceline tripled since this prediction was made.

Douglas Anmuth, Internet analyst at Barclays Capital, cut his rating today on Orbitz (OWW) to Equal Weight from Overweight, reducing his target to - oh my - $3, from $9. Anmuth says “Orbitz is likely to suffer disproportionately during the downturn” given its higher exposure to air and far less exposure to ad revenue. He adds that the company’s diversification moves will be “more challenging” in the current macro environment given pressure on hotel rates and fees and softening in international markets.

Oh my, the price went down as far as $ 1.10, not $ 3. But something must have happened to make Orbitz popular with traders again. The stock is worth $ 6.47 again. Maybe it´s because they actually make money. Or the analysts ejaculate because Orbitz fixed their marketing and slashed expenditures on Google ads:

In 2009, the Company intends to cut operating and capital costs by $40 million to $45 million in cash on an annual run rate basis. OWW also expects to continue to realize significant savings from focusing on the productivity of its e-marketing spending. For example, in the second quarter of 2009, marketing expenses fell 34% as the Company relied less on search engines to bring in buyers and made an effort to attract more non-paid traffic.

(Hostelworld: hint! Hint!)

I don't like to polish myself and say "I told you" but it was obvious. :cool:

True.

They have to pay taxes from next year and the recession DOES affects both BEs and hostels as well (which doesn't seem to be over very soon!).

Apparently, it only DID. Don´t you believe what the analysts say? Look at the charts, they must be drowning in money.

Don't we have too much "field experience"? :D

Um, yes. To make matters worse, you know something about websites and the internet. That makes you the totally wrong person to run a dotcom business! :D