One of the several hundred thousand vacation rental listings at HomeAway. Credit: HomeAway via Facebook.
Shares of HomeAway (AWAY.DL) stock were up just 0.41% as of 5:47 p.m. ET, as investors struggled to decide whether the latest financial report was worth cheering. Here's a closer look at the final totals versus Wall Street's projections:
| HomeAway | Revenue | YOY Growth | EPS | YOY Growth |
|---|---|---|---|---|
| Consensus estimate | $108.74 million | 20.5% | $0.13 | 62.5% |
| Q4 actuals | $109.71 million | 21.5% | $0.16 | 100% |
| DIFFERENCE | $0.97 million | 1% | $0.03 | 37.5% |
Sources: S&P Capital IQ and HomeAway press release.
For the full year, HomeAway reported $446.8 million in revenue and $0.67 a share in non-GAAP profit. Analysts tracked by S&P Capital IQ were calling for $445.8 million and $0.61 a share, respectively.
Commenting on the results, CEO and co-founder Brian Sharples said in a press release:
We've had a terrific year, delivering strong financial results and meaningful improvements in the traveler experience on our sites. HomeAway recently celebrated its tenth anniversary. Over the past decade, the company has experienced tremendous growth but what we're most proud of is bringing friends and families together in vacation rentals around the globe.
What went right: Paid listings grew 17.2% year-over-year and now top 1 million total. Of that, 329,000 -- or 31.5% -- are classified as "performance" listings whereby HomeAway's fees are paid after rental. In Q3, 31% of listings were performance-based. Over the long term, the shift should produce progressively higher profits as owners pay more on the back end for arranged rentals. (Cash flow from operations is already rising, up 28.8% in the fourth quarter and 39.3% for all of 2014.)
What went wrong: Light guidance is typical for HomeAway. We saw it in Q3, and the company went on to marginally beat its worse-than-expected revenue targets. There were also plenty of artificial sweeteners in its non-GAAP results: an extra billion in amortization expense, $4.4 billion of amortization of debt discount costs, and $1.57 billion for changing the redemption value of non-controlling interests. An added $2.8 billion in related tax expense offset those kickers to a degree, but it's still fair to say HomeAway's beat wasn't entirely organic.
What's next: Looking ahead, HomeAway expects total revenue in the range of $119 million to $120.5 million with adjusted earnings before interest, taxes, depreciation, and amortization of $22.5 million to $23.5 million.The company didn't supply specific per-share earnings guidance.
Analysts tracked by S&P Capital IQ have the vacation rentals specialist generating $122.38 million in revenue and $0.16 a share in profit versus $105.68 million and $0.14 a share in last year's first quarter.
Longer term, analysts have HomeAway generating 23.2% average annual earnings growth over the next three to five years.
