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Though I exited out of what was left of our position a few weeks ago, Priceline.com (NASDAQ:PCLN) continues to impress. The company released another stellar earnings report last night and the stock was up another 5-7% in after hours. This appears to be a very well run company, in the right niche, with a global footprint that (importantly) knows how to play Wall Street's "set the bar low and then smash it" game - Mr. Shatner would be proud.

I can't believe I was originally able to load up on this a year ago near $100. Wish I had been more patient. (Click to enlarge)

The full report is here, and highlights via IBD below. International results continue to exceed expectations.

  • In what has become a regular occurrence, Priceline late Wednesday released financial results that handily beat analyst estimates, led by international bookings. But the company's CEO sought to dampen enthusiasm a tad, saying growth will slow to merely very fast rates this year, largely because of the big growth in 2009.
  • Norwalk, Conn.-based Priceline, which trailblazed a name-your-price service, said its fourth-quarter profit minus items jumped 54% to $1.99 a share from $1.29 in the year-earlier quarter. The consensus estimate of 19 analysts polled by Thomson Reuters called for $1.68.
  • Priceline's per-share profit has beaten analyst views by at least 18 cents in each of the past six quarters.
  • Priceline said sales surged 33% to $541.8 million. Analysts expected $529.8 million. The company said international gross travel bookings soared 81% (70% in local currencies), and hotel room nights booked surged 60% worldwide. Domestic bookings rose 21%.
  • Gross bookings, the dollar value of all travel services bought, soared 53% to $2.26 billion.
  • But Priceline Chief Executive Jeffery Boyd warned in a conference call with analysts that the company expects booking and other growth rates "to decelerate," especially in the second half of the year, as its results are compared against relatively strong periods of performance.

Guidance:

  • Priceline said it expects first-quarter revenue to rise 23% to 27% from first-quarter 2009. Analysts had forecast a 27% increase, to $584.8 million. The company pegged profit minus items at $1.54 to $1.64 per share, where analysts were forecasting $1.41.

Analyst talk:

  • Kessler says Priceline's done a "phenomenal job" rolling out attractive travel deals in the last year. But he says there could be a few bumps in the road ahead. Online ad prices are firming and that could mean higher sales and marketing expenses for Priceline, he says. Kessler also says that recent economic woes in Europe, Priceline's biggest overseas market, could crimp travel buying.
  • Kessler also says that as the U.S. economy rebounds, hotels and airlines might get stingy about making their inventories available to Web travel firms like Priceline.
  • Morningstar's Miller doesn't expect Europe's recent economic wrinkles to have "much of a material effect" on Priceline. He says the company can offset any small drop in online travel demand through aggressive marketing and expanding into new geographic areas. He says Priceline can also sign new travel suppliers to secure more inventory.
  • A report issued Monday by Citigroup analyst Mark Mahaney notes that Priceline has the largest installed base and lowest-cost online travel model in Europe. He says it also has a good "defensive hedge" in the U.S. because its name-your-own-price offering is well-known. Mahaney said Priceline has "the best management team in the online travel sector."

[Nov 10, 2009: Priceline.com Hits an Earnings Home Run]
[Aug 10, 2009: Priceline.com - Recession Recsmession! Continued Impressive Results]
[May 14, 2009: Priceline.com in Investors Business Daily]
[May 11, 2009: Priceline.com Continues to Execute Well]
[Feb 19, 2009: Priceline.com Impresses on Earnings]
[Aug 6, 2008: Priceline.com - Down 17% on Good Earnings?]
[May 8, 2008: 2 Earnings Reports of Note: AIG and Priceline]

Disclosure: No position

Source: Another Stellar Earnings Report for Priceline.com