Buzz Stocks: Expedia, American Express, Twitter

Today's stocks to watch include Expedia Inc (EXPE), American Express Company (AXP), and Twitter Inc (TWTR)

Feb 12, 2015 at 9:10 AM
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U.S. benchmarks are poised to flirt with year-to-date highs, thanks to a ceasefire between Russia and Ukraine. Among the equities in focus are online travel concern Expedia Inc (NASDAQ:EXPE), blue chip American Express Company (NYSE:AXP), and microblogging issue Twitter Inc (NYSE:TWTR).

  • EXPE is ready to rally 7%, after the company agreed to buy Orbitz Worldwide, Inc. (NYSE:OWW) for about $1.6 billion, or $12 per share, in cash -- a near 25% premium to OWW's closing price of $9.62 on Wednesday. EXPE's anticipated pop should put the shares north of their 200-day moving average, which was breached in the wake of a post-earnings bear gap on Feb. 6. Since then, the stock has been lingering near $78 -- and finished at $78.22 yesterday -- and its 14-day Relative Strength Index (RSI) has dipped to 31, on the cusp of oversold territory. Should Expedia Inc pick up steam, a mass exodus of short sellers could translate into more upside; it would take more than six sessions to buy back all the shorted EXPE shares, at the equity's average pace of trading.

  • AXP is bracing for a 2.7% dip out of the gate, on news that the company will end its domestic credit card partnership with Costco Wholesale Corporation (NASDAQ:COST) on March 31, 2016. Since the stock's last rejection in the $95 area back in late December, AXP has surrendered roughly 9% to finish Wednesday at $86.01, with rebound attempts halted at its 80-week moving average. Analysts are wary of the Dow component, as American Express Company has just eight "buy" or better ratings, compared to 12 "hold" or worse suggestions. On the other hand, short interest is paltry at less than 1% of the stock's float, suggesting the bearish bandwagon is far from crowded.

  • Finally, TWTR is flirting with a 1.1% lead in electronic trading, after the firm announced an agreement to buy Niche -- a startup talent agency for social media -- for an undisclosed sum. Technically speaking, Twitter Inc finished at $47.50 yesterday, notching a fourth straight close atop its 200-day trendline, which was conquered after an earnings beat last week. Despite an initial positive reaction from analysts, not everyone on Wall Street has bought into TWTR. Almost half of the brokerage firms following the stock maintain "hold" or worse opinions, and the average 12-month price target of $53.38 represents expected upside of just 12.3% to the equity's current perch.


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