As of June 24, 2025, Tripadvisor Inc has a Discounted Cash Flow (DCF) derived fair value of $20.08 per share. With the current market price at $13.06, this represents a potential upside of 53.7%.
| Key Metrics | Value |
|---|---|
| DCF Fair Value (5-year) | $12.93 |
| DCF Fair Value (10-year) | $20.08 |
| Potential Upside (5-year) | -1.0% |
| Potential Upside (10-year) | 53.7% |
| Discount Rate (WACC) | 6.7% - 8.7% |
Revenue is projected to grow from $1835 million in 12-2024 to $3715 million by 12-2034, representing a compound annual growth rate of approximately 7.3%.
| Fiscal Year | Revenue (USD millions) | Growth |
|---|---|---|
| 12-2024 | 1835 | 3% |
| 12-2025 | 1849 | 1% |
| 12-2026 | 2106 | 14% |
| 12-2027 | 2368 | 12% |
| 12-2028 | 2586 | 9% |
| 12-2029 | 2819 | 9% |
| 12-2030 | 2999 | 6% |
| 12-2031 | 3205 | 7% |
| 12-2032 | 3370 | 5% |
| 12-2033 | 3538 | 5% |
| 12-2034 | 3715 | 5% |
Net profit margin is expected to improve from 0% in 12-2024 to 5% by 12-2034, driven by operational efficiency and economies of scale.
| Fiscal Year | Net Profit (USD millions) | Profit Margin |
|---|---|---|
| 12-2024 | 5 | 0% |
| 12-2025 | 69 | 4% |
| 12-2026 | 84 | 4% |
| 12-2027 | 100 | 4% |
| 12-2028 | 114 | 4% |
| 12-2029 | 131 | 5% |
| 12-2030 | 140 | 5% |
| 12-2031 | 151 | 5% |
| 12-2032 | 160 | 5% |
| 12-2033 | 170 | 5% |
| 12-2034 | 180 | 5% |
with a 5-year average of $60 million. Projected CapEx is expected to maintain at approximately 5% of revenue.
Depreciation is based on an average useful life of 5 years for capital assets.
| Fiscal Year | D&A (USD millions) |
|---|---|
| 12-2025 | 69 |
| 12-2026 | 80 |
| 12-2027 | 94 |
| 12-2028 | 109 |
| 12-2029 | 124 |
| 12-2030 | 136 |
Net working capital is expected to increase gradually, with projected changes affecting free cash flow.
| Components | Average Days |
|---|---|
| Days Receivables | 44 |
| Days Inventory | 0 |
| Days Payables | 753 |
| Fiscal Year | EBITDA | Tax | CapEx | Change in NWC | FCF |
|---|---|---|---|---|---|
| 9M/2025 | 124 | 19 | 73 | 44 | (13) |
| 2026 | 197 | 31 | 111 | (2) | 57 |
| 2027 | 233 | 37 | 125 | 2 | 69 |
| 2028 | 269 | 42 | 137 | 24 | 66 |
| 2029 | 306 | 48 | 149 | 11 | 98 |
| Valuation Method | Fair Price (USD) | Potential Upside |
|---|---|---|
| 5-Year DCF (Growth) | 12.93 | -1.0% |
| 10-Year DCF (Growth) | 20.08 | 53.7% |
| 5-Year DCF (EBITDA) | 11.21 | -14.2% |
| 10-Year DCF (EBITDA) | 14.70 | 12.5% |
Is Tripadvisor Inc (TRIP) a buy or a sell? Tripadvisor Inc is definitely a buy. Based on our DCF analysis, Tripadvisor Inc (TRIP) appears to be significantly undervalued with upside potential of 53.7%. The company's strong projected growth in revenue and profitability, coupled with consistent capital expenditure, supports our positive outlook on its intrinsic value.
Key investment drivers include:
Investors should consider a strong buy at the current market price of $13.06.