Liberty TripAdvisor Holdings, Inc. – Value Analysis (NASDAQ:LTRPA) : September 29, 2017

Capitalcube gives Liberty TripAdvisor Holdings, Inc. a score of 59.

Our analysis is based on comparing Liberty TripAdvisor Holdings, Inc. with the following peers – Xiangtian (Usa) Air Power Co., Ltd., Corix Bioscience, Inc., Monarch Casino & Resort, Inc. and Caesars Acquisition Co. Class A (XTNY-US, CXBS-US, MCRI-US and CACQ-US).

Investment Outlook

Liberty TripAdvisor Holdings, Inc. has a fundamental score of 59 and has a relative valuation of UNDERVALUED.

Fundamental Score

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Company Overview

  • Considering peers, relative underperformance over the last year and the last month suggest a lagging position.
  • It trades at a lower Price/Book multiple (0.17) than its peer median (2.75).
  • The market expects LTRPA-US to grow faster than its peers and for the company to improve its current ROE.
  • LTRPA-US has relatively high profit margins while operating with median asset turns.
  • Changes in annual earnings (relative to peers) are better than the change in its revenues (relative to peers), implying the company is focused more on earnings.
  • LTRPA-US‘s return on assets currently and over the past five years is around the peer median and suggest that it does not have any particular operational advantages versus peers.
  • The company’s relatively high pre-tax margin suggests tight control on operating costs versus peers.
  • Compared with the peers chosen, LTRPA-US has had faster revenue growth in prior years and a current P/E ratio that suggests faster growth in the future suggesting superior growth expectations.
  • The company’s relatively low level of capital investment and below peer median returns on capital suggest that the company is in maintenance mode.
  • LTRPA-US‘s operating performance may not allow it to raise additional debt.

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Leverage & Liquidity

LTRPA-US would seem to have a hard time raising additional debt.

  • With debt at a relatively low 14.35% of its enterprise value compared to an overall benchmark of 25% (Note: The peer median is currently 4.92%), and relatively tight interest coverage level of 0.59x, LTRPA-US would have a hard time raising much additional debt. Thus, the company is classified as having Limited Flexibility when it comes to raising more debt.
  • Of the 4 chosen peers for the company, only 2 of the stocks have an outstanding debt balance. Companies with no debt include XTNY-US and CACQ-US.

LTRPA-US has maintained its Constrained profile from the recent year-end.

  • LTRPA-US‘s interest coverage is greater than (but within one standard deviation of) its five-year average interest coverage of -1.77x.
  • Though its interest coverage has remained relatively stable at 0.59x compared to 2016, its peer median has increased to 43.98x from 33.70x during this period.
  • Interest coverage fell 10.65 points relative to peers. It is also below the 2.50x coverage benchmark unlike the peer median.
  • LTRPA-US‘s debt-EV is its highest relative to the last five years and compares to a low of 9.09% in 2015.
  • While its debt-EV increased to 14.35% from 11.31% (in 2016), its peer median decreased during this period to 4.92% from 5.82%.
  • Relative to peers, debt-EV rose 3.94 percentage points.

Access the detailed analysis for Liberty TripAdvisor Holdings, Inc.

Key Liquidity Items

Company Debt/Enterprise Value (%) Current Ratio Interest Coverage (x) Cash Flow To Total Debt (%)
Xiangtian (Usa) Air Power Co., Ltd. 0 1.08 No interest exp 999
Corix Bioscience, Inc. 34.37 N/A -9.79 -37.78
Monarch Casino & Resort, Inc. 4.92 1.2 43.98 174.44
Caesars Acquisition Co. Class A 0 2.64 No interest exp 999
Liberty TripAdvisor Holdings Inc Class A 14.35 1.93 0.59 36.95
Peer Median 4.92 1.57 43.98 174.44
Best In Class 4.92 2.64 No interest exp 999

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Company Profile

Liberty TripAdvisor Holdings, Inc. engages in online advertising and commerce business through its subsidiaries. It operates through TripAdvisor and Corporate & Other segments. The TripAdvisors segment includes online travel community, aggregating reviews and opinions from its community of travelers about destinations, accommodations, restaurants, and activities throughout the world. The Corporate & Other segment consists of assets or businesses category which the company does not disclose separately. The company was founded on August 27, 2014 and is headquartered in Englewood, CO.

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