Online travel faces search competition
April 28, 2006 |
Although online travel companies saw strong first-quarter bookings, increasing competition from suppliers and search engines could pressure long-term earnings growth, according to a Merrill Lynch report.
Although online travel companies saw strong first-quarter bookings, increasing competition from suppliers and search engines could pressure long-term earnings growth, according to a Merrill Lynch report.
The research firm maintained a “neutral” outlook on the online travel industry and “neutral” ratings on Expedia and Sabre Holdings.
The analyst estimates that Sabre’s Travelocity’s net revenue rate will increase to 10.3% in the first quarter, while Expedia’s rate will decline to 11.4%.
Unique visitor traffic to online travel sites was down 6% year-over-year on average in the first quarter, with traffic to Orbitz down 16% and Cheaptickets up 1%.
Get the full story at Forbes
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