Per-share earnings have outrun the business itself, and the cash behind it is real, yet near its high, each buyback dollar retires far fewer shares.
Expedia (EXPE) stock has gained about 56% over the past twelve months and now trades within a few percent of the 52-week high. The global travel marketplace has a quieter engine running underneath the bookings and margins: a share count that keeps getting smaller, which is why per-share earnings have been growing faster than the business behind them. Near a high, though, that engine costs more to run.
Nearly Ten Points A Year The Business Never Earned
Over the last three years, net income grew 36.9% a year on average. Earnings per share grew 46.8% a year on average over the same three years. That roughly ten-point gap is not something the operation produced. It is what happens when the same profit is split among fewer owners: over those three years the share count has fallen about 6.5% a year on average, so a holder who did nothing owns a steadily larger slice of the same company.
Free Cash Flow More Than Doubled In Two Years

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