Google to Attack Internet Travel Companies in 2012

Google (NASDAQ:GOOG) is moving into another business, and this time it’s how you book travel. Google debuted its Google Flight Search feature this month, which provides a handy chart of all available flights for given origins and destinations along with links that go directly to the airlines. Google has had great success in nearly every business it has tapped into, and it hopes the $110 billion travel industry will be the same.

Many travel industry competitors say Google is abusing its power as Google Flight Search is now the first result to appear when you search Google for flights. If you search “NY to LA” on Google, the first result will now be a Google-powered flight chart where you once might have found links to Expedia (NASDAQ:EXPE), Travelocity, and Orbitz (NYSE:OWW).

Airlines have to pay approximately $10 to on-line travel agencies for each flight booked whereas Google classifies its flight search as advertising. There is no information regarding how much this advertising might cost the airlines, but it appears it’s well worth the money.

Here’s how internet travel stocks closed the year ahead of Google’s impact:

Expedia Inc. (NASDAQ:EXPE): EXPE shares recently traded at $29.02, down $0.32, or 1.09%. They have traded in a 52-week range of $27.28 to $65.78. Volume today was 2,462,848 shares versus a 3-month average volume of 2,335,320 shares. The company’s trailing P/E is 8.61, while trailing earnings are $3.37 per share.

priceline.com Incorporated (NASDAQ:PCLN): PCLN shares recently traded at $467.71, down $8.29, or 1.74%. They have traded in a 52-week range of $402.25 to $561.88. Volume today was 476,333 shares versus a 3-month average volume of 1,205,070 shares. The company’s trailing P/E is 24.77, while trailing earnings are $18.88 per share.

Orbitz Worldwide, Inc. (NYSE:OWW): OWW shares recently traded at $3.76, down $0.07, or 1.83%. They have traded in a 52-week range of $1.57 to $5.75. Volume today was 143,723 shares versus a 3-month average volume of 308,395 shares. The company’s trailing earnings are $-0.66 per share.

To contact the reporter on this story: Ashley Cloninger at staff.writers@wallstcheatsheet.com

To contact the editor responsible for this story: Damien Hoffman at editors@wallstcheatsheet.com

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