IAC/InterActiveCorp (IAC) and Liberty TripAdvisor Holdings (NASDAQ:LTRPA) Critical Analysis

IAC/InterActiveCorp (NASDAQ: IAC) and Liberty TripAdvisor Holdings (NASDAQ:LTRPA) are both retail/wholesale companies, but which is the better investment? We will compare the two businesses based on the strength of their dividends, valuation, profitability, earnings, risk, institutional ownership and analyst recommendations.

Insider and Institutional Ownership

85.2% of IAC/InterActiveCorp shares are owned by institutional investors. Comparatively, 95.8% of Liberty TripAdvisor Holdings shares are owned by institutional investors. 10.6% of IAC/InterActiveCorp shares are owned by company insiders. Comparatively, 4.0% of Liberty TripAdvisor Holdings shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Valuation & Earnings

This table compares IAC/InterActiveCorp and Liberty TripAdvisor Holdings’ gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
IAC/InterActiveCorp $3.10 billion 2.63 $448.71 million $2.66 38.89
Liberty TripAdvisor Holdings $1.58 billion 0.61 $238.00 million $0.39 32.69

IAC/InterActiveCorp has higher revenue and earnings than Liberty TripAdvisor Holdings. Liberty TripAdvisor Holdings is trading at a lower price-to-earnings ratio than IAC/InterActiveCorp, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a breakdown of current ratings and price targets for IAC/InterActiveCorp and Liberty TripAdvisor Holdings, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
IAC/InterActiveCorp 0 1 18 0 2.95
Liberty TripAdvisor Holdings 0 1 0 0 2.00

IAC/InterActiveCorp presently has a consensus price target of $108.22, suggesting a potential upside of 4.62%. Given IAC/InterActiveCorp’s stronger consensus rating and higher possible upside, research analysts clearly believe IAC/InterActiveCorp is more favorable than Liberty TripAdvisor Holdings.

Profitability

This table compares IAC/InterActiveCorp and Liberty TripAdvisor Holdings’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
IAC/InterActiveCorp 7.66% 9.16% 4.00%
Liberty TripAdvisor Holdings 1.20% 0.45% 0.33%

Volatility & Risk

IAC/InterActiveCorp has a beta of 1.14, suggesting that its share price is 14% more volatile than the S&P 500. Comparatively, Liberty TripAdvisor Holdings has a beta of 2.27, suggesting that its share price is 127% more volatile than the S&P 500.

Summary

IAC/InterActiveCorp beats Liberty TripAdvisor Holdings on 11 of the 14 factors compared between the two stocks.

IAC/InterActiveCorp Company Profile

IAC/InterActiveCorp (IAC) is a media and Internet company. The Company’s brands include HomeAdvisor, Vimeo, Dictionary.com and Match Group’s online dating portfolio, which includes Tinder, PlentyOfFish and OkCupid. Its segments include Match Group, HomeAdvisor, Video, Applications and Publishing. Match Group includes the dating and non-dating businesses of Match Group, Inc. HomeAdvisor is a home services digital marketplace that helps connect consumers with home professionals in North America, as well as in France, the Netherlands and Italy under various brands. Its Video consists of Vimeo, Electus, CollegeHumor, Notional, IAC Films and Daily Burn. Applications consists of Consumer, which include its direct-to-consumer downloadable desktop applications, Apalon, which houses its mobile applications and SlimWare, and Partnerships, which includes its business-to-business partnership operations. Publishing consists of Premium Brands business, and Ask & Other business.

Liberty TripAdvisor Holdings Company Profile

Liberty TripAdvisor Holdings, Inc. is a holding company. Through its interests in subsidiaries and other companies, the Company is primarily engaged in the online travel research and online commerce industries. The Company’s subsidiaries include TripAdvisor, Inc. (TripAdvisor), which owns and operates a portfolio of online travel brands, and BuySeasons, Inc., which owns and operates BuyCostumes.com and the Celebrate Express (BuySeasons) family of Websites. TripAdvisor is a travel site focusing on helping people around the world to plan and book a trip. TripAdvisor manages its business in two segments: Hotel, including click-based advertising, display-based advertising and subscription-based advertising, and Non-Hotel, including its attractions, restaurants and vacation rental businesses. BuySeasons is an online retailer and supplier of costumes, accessories, seasonal decor and party supplies.

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