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Sources of value. International business and hotel reservations are the main sources of value for Priceline. With the separation of Booking.com and Agoda, Priceline focuses on the development of operations in the international market, thus achieving 69 percent of the total number of gross bookings and 82 percent of total operating income. Growth in income levels in combination with a high growth rate in the developing countries of China, India and Southeast Asia, high growth in the budget of travelers outside the United States is also expected. The lack of standardization of travel services outside the US, along with the fragmented accommodation industry in Europe and the Asia-Pacific region, leaves a lot of room for achieving premium prices. International hotel reservations through Priceline and its dependent sites can contribute to achieving almost 59 percent of the total number of reservations and almost 67 percent on consolidation of operating costs.
Hotel reservations. Based on the selection of analyzes, the Priceline Hotel Booking Sector makes up 90.7 percent of the 520 dollars total stock price. The average daily rate per hotel room (Graph 2) refers to the average income per day from the booked (booked) hotel room. The average daily price per hotel reservation increase from 135 dollars by 2012, to 175 dollars in 2017.

Graph 2: Average daily rate (ADR) per hotel room ($)
The amount of the margin realized from the hotel booking relates to the percentage of gross hotel reservations made through various partner websites of Priceline. Revenue from the margin to hotel reservations is gradually increasing due to the Agoda.com site that is operational in the Asia Pacific region. The total margin for hotel reservations is slower and reach 25 percent by 2017, which is the end of the forecast period. Priceline market share of occupied hotel rooms (Graph 3) refers to the share of the total number of hotel rooms sold worldwide through the Internet.

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Graph 3: Priceline market share of occupied hotel rooms (percent)
Priceline has entered the global hotel reservation market and continuously increases the percentage of growth related to international business. Priceline will continue to increase its market share, with a reduced pace of up to 3 percent (or 185 million nights) by 2018. The global number of hotel rooms (Graph 4) refers to the total capacity of free hotel rooms in the world. Priceline reaches 26 million overnight stays by 2017. The estimate is that occupancy rates of hotel rooms by 2017 was on historical level of 65 percent.

Graph 4: Global number of hotel rooms (in millions)
Expedia Corporate Overview
Expedia is an online provider that includes travel and accommodation information. It operates through tourist portals such as expedia.com, hotels.com and hotwire.com that connect travelers with hotels, airlines, shipping companies (cruises) and rent-a-car companies.06286500 Expedia corporate business is based on business through the Egencia website (egencia.com), which provides relevant tourism products and services to business partners in the tourism industry.
Expedia Media and Business is bound to advertise through the TripAdvisor Media Network (tripadvisor.com), where information is collected and published, such as hotel descriptions that can interest travelers, various pre-booking research studies, generating revenue by offering hotel advertising and agencies. Hotel reservations make up 56 percent of the total price of Expedia’s stock price, Tripadvisor.com represents 23 percent and Booking of air tickets 10 percent of the total stock price estimate. In addition, Expedia sells advertisements on the sites of these companies or pay-per-click or charges ads depending on the length of advertising. Estimation of stock prices and total value of the enterprise was done by summing the value of individual departments of the company through individual analyzes. The value of each department of a company is calculated using the method of cash flow discounting (DCF).
The forecast of basic DCF changes such as price, market share and profit margin for different parts of the company is estimating. The analysis below focuses primarily on important forecasts of the movement of stock prices and valuation. Current forecasts are that Expedia market share of reserved rooms is growing from 2.37 percent in 2017 to 2.64 percent by 2019. EBITDA margin is projected to decline from 22.9 percent in 2017 to 21 percent by 2019. The current EBITDA margin for corporate tourism services is growing from 12.6 percent in 2017 to 13 percent by 2019. It is possible that it be 1 percent less than the price estimate, if the EBITDA margin declines to a historical level from close to 5 percent in 2019. Expedia’s Hotel Bookings business is a basic source of value for the following reasons. Margin profit on hotel reservations is much higher than the margin of earnings from airline reservations. The results of Expedia’s earnings show that this ratio was 5 times higher for hotel reservations than airline reservations. Based on the selection of analyzes, the Expedia hotel reservation department makes up 55.7 percent of the 30.60 dollars of the total stock price. The average daily rate per hotel room refers to the average revenue per day from the booked (booked) hotel room. ADR is obtained by dividing the total annual income from the total number of occupied overnights per year.

Graph 5: Average daily price per hotel ($)
The estimate is that the average daily rate per hotel room has been reduced from 101 dollars in 2011 to 110 dollars in 2013 and that it continues to rise to 127 dollars in 2017. The average daily price for hotel reservations slightly increases from 120 dollars in 2015 to 127 dollars in 2017. The amount of the margin realized from the hotel booking refers to the percentage of gross hotel reservations made through various partner sites of Expedia. According to the estimates of margins on hotel reservations, decreased from 23.5 percent in 2014 to 22.3 percent in 2017. Going forward, it can be expected that margin income to hotel reservations gradually drops from 23.2 percent in 2012 to 21 percent by 2018, which is the end of the forecast period.

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