With 2012 just beginning, now's a great time to gauge how the stocks you're interested in are likely to do this year and beyond. By knowing what stock analysts and fellow investors expect from a stock, you'll be smarter about whether you should keep buy it for your portfolio -- or sell it if you already own it.
Today, let's take a look at Travelzoo
Forecasts on Travelzoo
|Median Target Stock Price||$34.50|
|2011 EPS Estimate||$1.37|
|2012 EPS Estimate||$1.66|
|Expected Annual Earnings Growth, Next 5 Years||17%|
Source: Yahoo! Finance.
How will Travelzoo do this year?
With Travelzoo, analysts don't appear certain about what to expect. Although they expect fairly strong earnings growth this year, analysts have pegged their target stock price just 10% or so above its current level. Moreover, Motley Fool CAPS members aren't convinced that the stock can rebound from its 2011 losses.
The problem with Travelzoo is one that has pervaded the entire daily deals space: a lack of follow-through buying. A recent Rice University study found that 32% of businesses lost money using Groupon
But to a large extent, deals-related stocks got punished beyond what their results justified. For instance, OpenTable
What may eventually save Travelzoo are behemoth players seeking a quick entry into the space. With Microsoft and Amazon.com
Travelzoo has good prospects, but we think you can do better. Read about the Motley Fool's pick for the top stock for 2012 and its connection to discount-hungry consumers. The report is free, but it won't be there forever, so check it out today.
Click here to add Travelzoo to My Watchlist, which can find all of our Foolish analysis on it and all your other stocks.
Fool contributor Dan Caplinger doesn't own shares of the companies mentioned. The Motley Fool owns shares of Microsoft, OpenTable, and Amazon.com. Motley Fool newsletter services have recommended buying shares of Amazon.com, OpenTable, Microsoft, and Travelzoo, as well as creating a bull call spread position in Microsoft. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Fool has a disclosure policy.