On Feb. 13, shares of Orbitz Worldwide (NYSE: OWW) jumped nearly 29% on news that it crushed analyst forecasts for the fourth quarter of fiscal 2013. Shares retreated slightly on the following day, as shareholders are likely becoming concerned about overvaluation; but is this fear overblown? After reporting such strong numbers, is Orbitz ready to soar higher, or is the company still destined for the loser's circle?

Orbitz smashed Mr. Market's low expectations
For the quarter, Orbitz reported revenue of $197.4 million, 4% above the $189.7 million the company reported in the year-ago quarter. This doesn't sound impressive when you consider that rival Expedia (EXPE 2.97%) grew its revenue 18% in the same quarter or that analysts expect priceline.com (BKNG 4.38%) to grow its top line by 27%. Nevertheless, it was still far higher than the $191.2 million anticipated.

According to management, the rise in revenue came about because of an increase in the volume and price of hotel and vacation packages of 18% and 16%, respectively. This was negatively affected by an 11% decline in air transactions and price per transaction.

In terms of profitability, Orbitz's situation was even better. For the quarter, the company reported earnings per share of $0.05, better than the zero earnings that analysts expected and significantly higher than the -$2.96 the company reported in the fourth quarter of 2012. In its earnings release, management attributed the rise in net income to a revenue increase but also to a decrease in the company's cost of revenue and the absence of a goodwill impairment, like the one it booked a year earlier.

Despite strong results, Orbitz still lags its peers
For the year, Orbitz saw its revenue rise nearly 9% from $778.8 million to $847 million. Although this is a healthy growth rate, it's something that is quite foreign to the company. As opposed to growing rapidly over time, the business meandered around during the previous four years. Over that period, management reported that revenue grew less than 6% from a base of $737.6 million.

Compared to the historical mediocrity exhibited by Orbitz, rivals like Expedia and Priceline have done far better. Over the past five years, Expedia saw its revenue jump 61% from $3 billion to $4.8 billion as it grew its room nights sold. Just as in the case of Orbitz, though, the business was negatively affected by a decline in revenue per room night.

Although Expedia's revenue growth over this time frame was phenomenal, it fell far short of Priceline's jump in sales. Unfortunately, Priceline has yet to report full-year sales for 2013, but from 2009 through 2012, the company's revenue soared 125%. The same factors impacting competitors have hurt the business as well, but it has managed to maintain a higher revenue margin than Expedia and Orbitz.

In terms of profitability, the situation for Orbitz has looked even worse over time. Between 2009 and 2012, the company saw its net loss decline from $337 million to $301.7 million. Admittedly, most of this loss over time has been due to impairment charges, but even absent those, its net income would have only amounted to $24 million in 2012. In 2013, the situation didn't improve too much. For the year, the company reported net income of $165.1 million, but almost all of this gain was attributed to an income tax benefit.

Despite Expedia's tremendous revenue growth, it is in a similar boat to Orbitz when it comes to profitability. Fortunately, the business has not experienced full-year net losses over the past five years, but its net income has declined 22% from $299.5 million to $232.9 million.

Even though you might expect Expedia's rising revenue to have a favorable impact on its bottom line, the opposite turned out to be true. In an effort to grow business, Expedia saw a meaningful rise in its cost of revenue and operating expenses relative to sales. Between 2009 and 2013, for instance, the company saw its cost of revenue rise from 20.5% of sales to 21.8%. Its operating expenses rose even more, from 60.1% of sales to 70.6%.

Priceline, on the other hand, never failed to surprise its shareholders. Between 2009 and 2012, the company grew its net income an impressive 190% from $489.5 million to $1.4 billion. Although the company has seen its revenue margin decline recently, and its selling, general, and administrative expenses rise from 31.3% of sales to 40.8%, it has benefited from its cost of revenue declining from 46.1% of sales to 22.4%.

Foolish takeaway
Based on the data seen, it looks like Orbitz has been a mediocre company over the past few years. In 2013, however, this trend began to reverse. In the long run, the business has the potential to successfully play catch-up, but whether it will or not has yet to be seen. Moving forward, the Foolish investor who believes in the future of Orbitz could receive solid upside if management can maintain upward momentum. However, for the investor who is a little more risk-averse, Priceline is probably the best way to go.