It’s becoming en vogue to blame slowing earnings growth on the strong dollar. Just last week Stratasys tried to blame their current woes on a rising greenback and today Priceline (PCLN) joined the club, citing weakness in the Euro and British Pound in particular as headwinds to growth.
Far more troubling for investors in online booking agents might be the overall collapse in search interest in names like Priceline, Travelocity and Orbitz (source: Google Trends)
This picture contrasts sharply with the performance of stocks like PCLN and SABR (the owner of Travelocity):
- PCLN is up over 430% over the last 5 years
- SABR is up over 60% since its public listing mid-2014
Priceline has been acquisitive, and so to get the whole picture we must look at subsidiaries Kayak and Booking.com which have been drivers of marginal growth. After experiencing growth prior to 2011, search volume for Kayak reached its peak in 2012 and has been stable to declining since:
Likewise, Booking.com growth has stalled, despite concerted advertising efforts to bring it into the mainstream. Booking.com search volume remains small compared to the rest of the PCLN empire (all search results are normalized, i.e. 100 = the most volume over the period)
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