Expedia Group saw its shares decline by 16% over the past week, coinciding with the broader decline in the market due to escalating tariff tensions and their impact on economic growth. The company operates in a sector particularly sensitive to consumer spending and global trade disruptions, making it vulnerable to adverse market conditions. As major stock indexes, including the Nasdaq, plummeted and entered bear market territory, the travel and leisure industry faced additional pressure, affecting Expedia's stock performance. Investors reacted sharply to the possibility of reduced travel demand amid economic uncertainty, contributing to its significant weekly decline.

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Expedia Group's total shareholder returns over the past five years tallied at 127.74%, reflecting substantial long-term performance. This period has seen the company navigate complex industry dynamics, with earnings growing by an impressive average annually. Expedia's recent move to reinstate its quarterly dividend, suspended during the early pandemic, exemplifies its commitment to returning value to shareholders. Notably, the company exceeded both the US Hospitality industry and broader market returns over the past year, signaling its resilience and competitive advantages.

Furthermore, strategic decisions have shaped its growth trajectory. Key investments in AI and international expansion have played vital roles in boosting customer engagement and revenues. The renewed focus on stock buybacks, with a significant $1.76 billion investment, underscores management's confidence in future growth. Additionally, new partnerships, such as with Southwest Airlines, have enhanced Expedia's platform offerings, potentially drawing more customers. These initiatives collectively contributed to its robust five-year return performance.

Our valuation report here indicates Expedia Group may be undervalued.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Companies discussed in this article include NasdaqGS:EXPE.

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