Expedia surges on strong bookings growth

Shares of Expedia soared on Friday after the travel booking site reported first-quarter results that topped Wall Street forecasts on strong bookings growth.

The Bellevue, Washington-based company reported first-quarter profits of $44.1m or 34 cents a share, compared with a loss of $14.3m or 11 cents a share in the year-ago period. Sales rose 14 per cent to $1.37bn.

Wall Street analysts had forecast a loss of 19 cents a share, on sales of $1.35bn. On an adjusted basis however, the company reported a loss of 3 cents a share, against expectations for a profit of 6 cents.

The company also said hotel room night growth accelerated 32 per cent. Gross bookings rose 19 per cent year-on-year to $15bn, driven by growth in its core online travel companies business. Excluding the impact from the strong dollar, bookings rose 25 per cent.

Analysts at RBC Capital Markets raised the stock to "outperform" from "sector perform" and raised their price target to $120 from $87.

"This company has demonstrated an ability to work through industry challenges, while laying the foundation for strong broad-based growth," said Mark Mahaney, analyst at RBC Capital Markets. "Expedia has emerged as an excellent play on the secular growth in Online Travel."

Expedia shares, which gained 37 per cent in the past year, rose 7 per cent to $101.03 and was among the best performing stocks on the S&P 500.

FireEye shares rose nearly 7 per cent to $44.03, after the company that sells cyber security products to protect companies from attacks lifted its full-year revenue guidance and reported a 70 per cent jump in sales.

FireEye expects sales to range between $615m and $635m, compared with Wall Street estimates for $620.1m and ahead of its earlier forecast for revenues to range from $605m to $625m.

FireEye has done well in the wake of security breaches in the US and David DeWalt, chief executive, said the company "had a very strong start to the year, as the momentum we experienced at the end of 2014 continued into first quarter".

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Shares in Gilead Sciences rose 4 per cent to $104.61, after the US biotech company said first-quarter profits nearly doubled as sales of its Hepatitis C drugs, Sovaldi and its successor Harvoni, picked up.

The Foster City, California-based company reported profits of $4.3bn, or $2.76 per share, on sales that climbed 52 per cent to $7.6bn. Analysts on Wall Street had forecast earnings of $2.21 a share, on sales of $6.9bn.

LinkedIn shares fell 20 per cent to $201.15, after the social network for professionals said second quarter sales would fall short of analyst expectations.

US stocks rallied on Friday led by the S&P 500 materials sector. Healthcare stocks were also buoyed on the back of Gilead's results.

The S&P 500 rose 0.5 per cent to 2,095.59, the Dow Jones Industrial Average rose 0.6 per cent to 17,942.02. The Nasdaq Composite rose 0.5 per cent to 4,966.58.

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