CTRIP.COM THE CHINESE PRICELINE?

Ctrip.com (CTRP) is the Chinese version of Priceline who today rocketed up over 20% to finish at a 52 week high just above $72 from great earnings. Revenues moved up 16% higher at $355.9 million, fueled by a 93% surge in overseas gross bookings at Booking.com. Read the words – OVERSEAS bookings. This prompted on analyst to move price targets from $80 to $103. while median target rose to $86 from $72. So is there growth for Ctrip.com?
Well China seems synonymous to growth and with that Ctrip.com may be too. While the web is still growing in China, it’s still much less mature than in the US. I’ve been studying the web in China lately for a business project. Even on Motley Fool, Ctrip is a Hidden Gems stock pick suggesting that some people are keen to the growth prospects. Last earnings, net revenues rose 52% higher to $37.8 million. Earnings per diluted share soared from $0.11 a share to $0.17 a share (or $0.22 per share if you back out stock-based compensation expenses). So there is a lot of room to grow for this company. It can triple revenue easily. The market is still huge with more international travel coming to Shanghai and other parts of China for trade. Also the wealth is growing as well as the middle class means more trips to Macau for some Chinese Vegas time! But this is a long term stock.

They started with hotel bookings then expanded to airline and toured bookings. Last quarter it grew45% from last period. Also it has no debt and it’s profitable. Eventually the build out cost will die down only to leave more profit. It’s moving fast and the Beijing Olympics Games should only spur that one. But right now it’s trading a little high at forward PE of 45 but it’s growth far outweighs it. Look at Amazon!

Ok so the question is can Ctrip.com grow? Yes. Is it growing? Yes. Is there more room to grow? Yes. Is it the best of breed in China at least? Yes. Is it time to buy yet? Well, it’s at about $40 right now and I say near the next support which is $35. So between $38 to $35. But we’ll see. It’s not a sure thing yet.