2008 Beijing Olympics: Ctrip.com to Get the Gold

With the 2008 Beijing Olympics approaching, many travel-related stocks have been predicted to benefit. One of the most promising is the leading Chinese online travel service provider, Ctrip.com (CTRP).

Like U.S.-based Expedia (EXPE), Ctrip allows online users to book hotel accommodations, airline tickets, packaged tours and car rentals – you can even hire a car with a chauffeur Men-in-Black-Cars through their website.

This company captured almost 50% of its market share in China in 2007.

Bright future for this online travel service

With an estimated compounded growth rate of 43% through 2010 and an annual profit margin of over 33%, Ctrip is looking fundamentally sound.

Just recently, the company was named as a “famous trademark of China" which ensures its protection from international laws. Only Google (GOOG) and Baidu (BIDU) have also been granted that honor.

This tells us that Ctrip is set on global expansion.

But maybe you don’t want to hang in there too long…

With the Olympics coming in August, a final travel frenzy is imminent. Right now the share price for Ctrip is under $54. This stock could easily go up at LEAST 15% by the Summer Olympic’s Opening Ceremonies later this year.

Get in now, using August 8 as your target sell date. Based on its current P/E ratio, this stock may seem expensive. But growth rates and an overall profitability qualify it as an excellent medium-term speculation: Buy Ctrip at current levels with justified expectations of 15-20% gains by August 8.

Comments

[User 169775:]

If one wants to make money off of the Beijing Olympics, I suggest looking into Visa.

Visa of course has had its blockbuster IPO back on March 19, and while the stock might be a bit overvalued right now, it is sure to benefit from the Beijing Olympics because of its status as an Olympic Partner. The implications can be huge:

- Visa as an Olympic partner is the exclusive payment system of the games. They won't take Mastercard, American Express or any other credit card at the Olympics.

- Visa's publicity exposure will be immense-- Their TV commercials and brand placement will be on the TV sets of over a billion Chinese people during that time period, which may lead to an increase in Visa cards issued in China and rise in transactions (which is how Visa makes money).

- Travelers these days find it more convenient to use credit cards rather than traveler's cheques or buy local currency.

Something to consider.

2008 Apr 06 06:05 PM

[User 174045:]

The cash is shifting from Gold into Olympics-related equities.
Visa might have its big moment of glory this season too but not as big as all the other stocks you've mentioned.

Greed Still Good! :)

2008 Apr 06 11:26 PM