Dangerous descent: should these charts make investors who own online travel agencies nervous?

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)

chart1

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:

chart2

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)

chart3


Want to learn how to mine social data sources like Google Trends, StockTwits, Twitter, and Estimize? Make sure to download our new book Intro to Social Data for Traders by our very own Thomas Pendergrass


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Lead image licensed under CC BY 2.0 from leighklotz

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