Feb 9 (Reuters) - Shares of U.S. online travel services company Expedia fell 19 percent in premarket trading on Friday, after forecasting 2018 selling and marketing costs would outpace revenue growth as it battles rivals for market share.
The company, which owns brands including Expedia.com and Hotels.com, reported equally disappointing previous quarter results in October partly due to underperformance by its Trivago hotel-search website.
This was the first full quarter under Expedia’s new Chief Executive Officer Mark Okerstrom, who succeeded Dara Khosrowshahi after he left to take the top job at car-ride provider Uber Technologies Inc.
“Under new management, Expedia is more aggressively investing in tech and marketing to scale its global footprint and catch up to industry leader Priceline Group Inc, which currently has approximately 2x the inventory and room nights sold as Expedia,” RBC Capital Markets analyst Mark Mahaney said.
Mahaney lowered his price target for Expedia’s shares to $141 from $155, while maintaining an “outperform” rating.
Up to Thursday’s close of $123.03, Expedia’s shares had risen about 0.2 percent in the past 12 months, underperforming a 13.6 percent increase in the Dow Jones U.S. Travel and Leisure index. (Reporting by Ankit Ajmera in Bengaluru; Editing by Bernard Orr)