TripAdvisor to Acquire LaFourchette - Analyst Blog

TripAdvisor Inc. TRIP, an online travel research company, has recently agreed to acquire LaFourchette. The financial terms of the deal have been kept confidential.

Paris-based LaFourchette is an online restaurant booking website featuring more than 12,000 restaurants in Europe. Additionally, the company offers management software solutions and application programming interfaces (APIs) for third-party developers to help restaurateurs increase their online business.

Upon the completion of the deal, LaFourchette and its employees will continue to operate from the company's offices in Paris and Barcelona.

The acquisition will complement TripAdvisor's existing restaurant offering by providing information about hotel bookings and related details such as discounts and booking details on mobile. This will improve efficiency, thereby expanding the company's user base, improving traffic, hotel shoppers and profits.

TripAdvisor has an aggressive merger and acquisition strategy. The company's most recent purchases include TripBod, a start-up which connects travelers with local experts, followed by Vacation Home Rentals for an undisclosed sum. Other takeovers in 2013 include GateGuru, a flight and airport information mobile app acquisition, following Oyster.com, TinyPost, JetSetter and CruiseWise.

TripAdvisor is the world's largest online travel research company. The acquisitions have helped the company to build a desired portfolio and increase page views per visitor since users now spend more time on its website. The company is striving to help consumers make their travel decisions easy and fruitful based on the experiences of other travelers.

TripAdvisor continues to witness robust top-line growth in every quarter. The company delivered a decent first quarter, with earnings exceeding the Zacks Consensus Estimate on the back of improved global travel market. Revenues were $281.0 million, up 22.2% year over year, driven by improvement in all its product lines and continued strong hotel shopper growth.

Over the long term, the company is well positioned for growth, given its expanding user base, improving margins and increasing monetization of social and mobile platforms.

Currently, TripAdvisor has a Zacks Rank #3 (Hold). Other stocks that have been performing well and are worth considering include WebMD Health Corp. WBMD, Shutterfly, Inc. SFLY and Brightcove, Inc. BCOV. While Brightcove sports a Zacks Rank #1 (Strong Buy), WebMD and Shutterfly carry a Zacks Rank #2 (Buy).

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