Tripadvisor Stock Jumps on News of Committee to Consider Deal Proposals—Key Level to Watch

Tripadvisor, Inc.

Tripadvisor (TRIP) shares surged more than 13% in after-hours trading Monday evening after the online travel review and advice company said that it had established a special committee to consider potential deal proposals, indicating its willingness to explore strategic opportunities.

According to a statement released on the company’s website, the special committee will comprise independent members of Tripadvisor’s board of directors and have a mandate to “evaluate any proposals that may be brought forward for a potential transaction, and any alternatives thereto, with regard to Tripadvisor.” The committee has also hired independent investment banking firm Centerview Partners LLC as its financial advisor to assist in the evaluation process.

Potential proposals “include those that may arise in the future as a result of the recent Liberty TripAdvisor Holdings Inc. (“LTRP”) disclosure of its intent to evaluate potential alternatives involving LTRP and Tripadvisor,” the statement added.

The company cautioned that no transaction was assured, and the committee “has not made any decisions with respect to a potential transaction.” It added that a possible deal would be subject to further checks and balances and require the approval of both the board and special committee. The statement said stockholders don’t need to act on the announcement at this time.

Tripadvisor will release its fourth quarter and full-year 2023 financial results on Wednesday after the closing bell. Analysts expect the online travel firm to post earnings of 7 cents per share, up from 4 cents per share in last year’s corresponding quarter.

TRIP shares formed a double bottom pattern between May and November last year, before promptly reclaiming a key area of support around $17.10. Since then, the stock has continued its push higher apart from several modest retracements toward the 50-day moving average. If the price continues to climb, keep an eye out on the chart for a zone of resistance between $27 and $28 near the August 2022 and February 2023 swing highs.

Tripadvisor shares gained 13.6% to $25.42 in after-hours trading Monday.

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As of the date this article was written, the author does not own any of the above securities.