TripAdvisor (NASDAQ:TRIP) shares jumped Thursday after the stock was raised to Buy from Neutral at BTIG, with the investment firm initiating a $25 per share price target on the stock.
The rating rise represents a significant change in direction for BTIG's view of TRIP, with analysts explaining that the firm has been downbeat on the stock for most of its 12 years as a public company.
TRIP shares are up over 5% at the time of writing, trading at $19 per share. Earlier in the session, the stock hit a high of $19.65.
Analysts said one of the reasons for the shift in gears is that "this isn't the same TRIP anymore with new management in place, metasearch no longer a majority of the business and an emerging tours & activities booking engine rising to the fore."
They also noted that ongoing challenges in metasearch should be more than offset by growth at Viator/TheFork and they "pencil out to low-double-digit topline growth and high-teens EBITDA growth," putting the firm ahead of consensus expectations.
Furthermore, the company's "valuation is appealing at just 6x our 2024 EBITDA estimate, which implicitly ascribes little-to-no value for Viator, and we get to a stand-alone value of ~$1.7B for that asset," said analysts.