TripAdvisor benefits from a powerful network effect that is becoming stronger over time, and should lead to returns on invested capital (excluding goodwill) near 100%.
Revenue growth for the company is poised to accelerate in 2014 due to an increase in price per clicks.
There’s considerable operating leverage in the company’s business model, which should lead to an expansion in margins over time. Read more
With the stock trading in excess of 33.5 times our 2015 earnings per share estimate, we believe the market has priced in overly optimistic long-term growth assumptions.
The travel industry is highly cyclical, and an economic downturn could lead to a sharp downturn in business and personal travel.
TripAdvisor faces intense competition from Kayak, travago, Priceline.com, Expedia, Google, and to a lesser extent, Yelp. Read more
We think TripAdvisor's stewardship of shareholder capital is standard. President and CEO Stephen Kaufer co-founded the company in 2000 and has been instrumental in building TripAdvisor into the world's largest travel media company over the past 12 years. Read more
TripAdvisor is the world’s online travel company, as measured by monthly website visitors. In 2013 its websites reached 260 million unique monthly visitors, representing Read more
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