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Michael Michaud is the founder of Invest2Success.com (http://www.invest2success.com/) and the Invest2Success Blog (http://invest2success.blogspot.com/). He has been investing and trading in the financial markets since 1989. He founded Invest2Success.com to empower individual institutional... More
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  • Online Travel Bookings Momentum Stock Buy 0 comments
    Apr 11, 2011 8:39 AM | about stocks: PCLN, EXPE, OWW, CUK, CCL, RCL, SIX, LYV
    Priceline.com

    This Weeks Momentum Stock Pick from Zacks Investment Research


    Priceline.com Inc - Ticker PCLN is trading like a rocket, currently going ballistic for a new all-time high above $500. As one of the biggest gainers over the last few years, this Zacks #1 rank stock is a momentum powerhouse.

    Priceline is a stock that gets people fired up. The bears say its overvalued, but the bulls say valuations don't matter, helping lift shares to a recent all-time high above $500. That comes on the heels of the company's strong Q4 results from late February that came in ahead of expectations.

    Fourth-Quarter Results

    Revenue for the period was up 35% from last year to $731 million. Earnings also looked good, coming in at $3.04, 9% ahead of the Zacks Consensus Estimate, where the company has an average earnings surprise of 9% over the last four quarters.

    Priceline continued growing its strong international presence, with international revenue up 68% from last year to $375 million. Margins were also on the upswing, with gross profit climbing to $478 million, a 53% increase from last year.

    Financial Profile

    The company will also continue to benefit from its strong balance sheet, with cash and short-term investments of $1.67 billion and just $476 million in total debt.

    Earnings Estimates

    We saw some decent movement in estimates off the good quarter, with the current year up 75 cents to $17.18 while and the next-year estimate up $1.35 to $21.80, a bullish 27% growth projection.

    Current Valuation

    On the valuation front, PCLN's PEG Ratio (PE/Growth) of 1.22 isn't too much of a premium to the benchmark for value of 1.

    5-Year Stock Chart

    Take a look at the 5-year chart below, when I saw it, one thing came to mind; "Goose, we're going ballistic." Good luck trying to find a hotter stock for the last five years. How long it will continue is anyone's guess, but for the time being, PCLN is on fire. Take a look below.

    Priceline Stock Chart

    Priceline Company Profile

    Priceline.com Incorporated operates as an online travel company principally in the United States, Europe, and Asia. It provides various travel services, including airline tickets, hotel rooms, car rentals, vacation packages, cruises, and reservation services. The company also provides destination services, such as parking, event tickets, ground transfers, tours, and other services available at their travel destinations; and travel insurance package that provides coverage for trip cancellation, trip interruption, medical expenses, and emergency evacuation, as well as for the loss of baggage, property, and travel documents. In the United States, it offers its customers a choice that gives the ability to purchase travel services in a traditional, price-disclosed manner or the opportunity to use its Name Your Own Price service, which allows the customers to make offers for travel services at discounted prices. The company offers its products and services under priceline.com, Booking.com, Active Hotels, Agoda, Lowestfare.com, Rentalcars.com, Breezenet.com, MyTravelGuide.com, and Travelweb brands. priceline.com Incorporated was founded in 1997 and is headquartered in Norwalk, Connecticut.

    Click here for a free trial of Zacks Investment Research and their earnings estimates revisions stock picks.
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