Ctrip Has Been Thrown Out With The Bathwater
Alpha Gen Capital
Alpha Gen Capital
Fri, Jun. 10, 5:36 PM
Mon, Apr. 25, 5:39 PM
Mon, Apr. 11, 5:38 PM
Thu, Mar. 17, 11:30 AM
- Ctrip (CTRP -2.7%) is lower after beating Q4 estimates and guiding for 75%-80% Y/Y Q1 revenue growth, after accounting for the consolidation of peer Qunar's (QUNR +4.4%) results following the end of Q4 - Ctrip owns 45% of Qunar's voting interests following an October deal with Baidu. Consensus, which doesn't account for the Qunar consolidation, is for 45.9% growth.
- Qunar, which saw a major executive shakeup in January, is higher after beating Q4 estimates on the back of 148% revenue growth. On its earnings call (transcript), Qunar said it's declining to give formal Q1 guidance due to ongoing extension talks with hotel owners regarding the company's merchant hotel program, as well as its ongoing efforts to work with airlines to "clean up the agent market and eliminate the irregular behaviors by certain ticketing agencies on our platform."
- Ctrip's Q4: Accommodation (hotel) revenue rose 41% Y/Y to RMB1.2B ($183M). Transportation ticketing revenue rose 61% to RMB1.2B ($192M) thanks to a 143% increase in ticket volume. Packaged tour revenue rose 50% to RMB350M ($54M). Corporate travel revenue rose 26% to RMB136M ($21M).
Gross margin was flat Q/Q and up 400 bps Y/Y to 73%. Operating expenses rose 17% Y/Y (less than revenue growth of 50%) to RMB2.02B ($311M). Ctrip ended 2015 with $4.6B in cash and $4.8B in debt.
- Qunar's Q4: Accommodation revenue rose 423.6% Y/Y to $82.6M. Flight revenue rose 84.7% to $98.2M. Mobile accounted for 75.3% of total revenue.
Gross margin fell to 60.8% from 62.4% in Q3 and 73.5% a year ago. R&D spend rose 532.7% Y/Y to $236.5M, product sourcing spend 207% to $52.4M, sales/marketing 213% to $134.7M, and G&A (excluding one-time stock compensation expenses) 121.5% to $20.6M. Qunar ended 2015 with $1.1B in cash and $510M in debt.
- Ctrip: Q4 results, earnings release
- Qunar: Q4 results, earnings release
Fri, Jan. 22, 7:57 AM
- Nomura has upgraded #2 Chinese e-commerce firm JD.com (NASDAQ:JD) to Buy, and hiked its target by $8 to $35. Online travel leader Ctrip (NASDAQ:CTRP) has been started with a Buy rating and $50 target. Search giant Baidu (NASDAQ:BIDU) has been downgraded to Neutral.
- Regarding Ctrip, Nomura's Jialong Shi calls the company the best proxy for China's booming online travel agency market over the next decade, and deems it well-positioned to take advantage of industry growth thanks to its dominant market share and track record of execution.
- JD +3.8% premarket to $27.70. CTRP +2.4% to $43.95. Both companies have seen their share of pain as global equity markets tumbled this month (with Chinese markets among the hardest-hit).
- Baidu is brushing off the Nomura downgrade: Shares are up 1.1%. Nasdaq futures are up 1.9%.
Wed, Jan. 13, 11:49 AM
- Ctrip (CTRP -4.3%) says it's authorized to invest $1.3B in cash and issue 5.4M ordinary shares (equal to 21.6M ADS') via "limited partnership capital contribution or other financing arrangements, in several non-U.S. investment entities, which are managed or owned by parties unaffiliated with each other and unaffiliated with the Company and are dedicated to investing in businesses in China."
- Ctrip adds the entities "will acquire a significant minority stake" in Qunar (QUNR +12.6%) from Qunar shareholders, via privately-negotiated deals involving cash and/or Ctrip shares as payment.
- The news comes less than three months after Ctrip announced a deal to buy a major stake in Qunar (its biggest rival) from Baidu. The deal left Ctrip owning 45% of Qunar's voting interests, and Baidu 25% of Ctrip's voting interests.
- Last week, Ctrip announced it's investing $180M in Indian online travel firm MakeMyTrip.
Thu, Jan. 7, 9:53 AM
- Chinese online travel leader Ctrip (CTRP -4.2%) is investing $180M in Indian online travel firm MakeMyTrip (NASDAQ:MMYT) via convertible bonds. The company has also been granted permission to make open-market purchases of MakeMyTrip shares. Between the convertible debt and stock purchases, Ctrip is allowed to have a stake of up to 26.6%.
- MakeMyTrip has soared on the news. Ctrip, which recently obtained a major stake in top Chinese rival Qunar from Baidu, is following U.S. and Chinese markets lower. The Shanghai composite fell 7% overnight.
Dec. 30, 2015, 11:53 AM
- China's Yibada.com reports Alibaba (NYSE:BABA) is ending its travel services partnership with Ctrip (CTRP -2.7%), through which Ctrip's offerings are promoted on Alibaba's travel platform, on Jan. 1.
- The report comes two months after Ctrip struck a deal with Baidu to obtain a major stake in rival Qunar in exchange for Ctrip shares. Alibaba and Baidu compete in numerous markets (I, II). Alibaba launched its Alitrip travel brand in late 2014.
Dec. 10, 2015, 9:14 AM
- Priceline (NASDAQ:PCLN) and an unnamed investment firm firm are each investing $500M in Chinese online travel leader Ctrip (NASDAQ:CTRP) via convertible bonds. Priceline is now free to own up to 15% of Ctrip; its cumulative investment in the company (all in convertible bonds) has risen to $1.9B (45.5M shares).
- The investments come less than two months after Ctrip struck a deal to buy Baidu's stake in #2 Chinese online travel firm Qunar, thus leaving Ctrip with 45% of Qunar's voting interests and Baidu with 25% of Ctrip's voting interests.
- Ctrip has risen to $52.33 premarket.
- PRs: Priceline, Ctrip
Nov. 19, 2015, 12:44 PM
Nov. 19, 2015, 9:14 AM
Nov. 18, 2015, 5:44 PM
Nov. 18, 2015, 5:40 PM
- In addition to beating Q3 estimates, Ctrip (NASDAQ:CTRP) is guiding for 45%-50% Y/Y RMB-based revenue growth, above a 40.2% consensus. Shares have jumped to $108.50 after hours. Peer Qunar (NASDAQ:QUNR), which Ctrip now has a large stake in, has risen to $39.25 ahead of its Nov. 24 Q3 report.
- Q3 EPS benefited from $377M in "other income" stemming largely from the de-consolidation of Chinese Airbnb clone Tujia.com from Ctrip's results, thanks to the loss of control of Tujia following a new funding round.
- Financials: EPS also benefited from moderating spending growth: R&D, sales/marketing, and G&A spend respectively rose 36%, 40%, and 8% Y/Y to $131M, $132M, and $41M, after growing 66%, 42%, and 34% in Q2. The Qunar deal has been expected to yield further spending moderation. Gross margin rose to 735 from Q2's 71% and Q3 2014's 72%.
- Top-line performance: Accommodation revenue rose 45% Y/Y to $215M, transportation ticketing 51% to $190M, packaged tours 66% to $93M, and corporate travel 19% to $20M. Hotel reservation volume rose 50%, and ticketing volume 150%.
- Ctrip's Q3 results, PR
Nov. 18, 2015, 5:03 PM
- Ctrip.com (NASDAQ:CTRP): Q3 EPS of $2.20 may not be comparable to consensus of $0.09
- Revenue of $501M (+49% Y/Y) beats by $10.36M.
- Shares +4% AH.
Nov. 13, 2015, 11:38 AM
- Raymond James has downgraded Ctrip (NASDAQ:CTRP) to Outperform from Strong Buy.
- The move comes after Ctrip soared in late October in response to a deal to acquire Baidu's stake in top Chinese online travel rival Qunar, thus potentially ending a costly price war/advertising battle between the companies. Shares remain up 112% YTD.
Oct. 26, 2015, 1:27 PM
- Priceline (NASDAQ:PCLN) is up strongly following news Chinese online travel leader Ctrip (CTRP +21.1%), in which Priceline has an 11.6% stake, announced it's acquiring Baidu's stake in top rival Qunar (QUNR +15.9%) in exchange for shares.
- Expedia (NASDAQ:EXPE), which formed an alliance with Ctrip earlier this year as part of a deal to unload its 62.4% stake in struggling Ctrip/Qunar rival eLong, is also doing well.
- The deal leaves Ctrip owning 45% of Qunar's voting interests, and Baidu owning 25% of Ctrip's voting interests. It brings together China's two biggest online travel firms, and could lead each company to pare back the aggressive promotions and heavy marketing spend it has supported in the name of taking share from the other.
- HSBC's Chi Tsang: "Essentially it’s a merger between the two companies. If you look at the travel market, it’s such an obvious way to drive synergy through consolidation.” As part of the deal, Ctrip has won seats on Qunar's board, and Baidu seats on Ctrip's board.
- At current levels, Priceline's 17.5M-share stake in Ctrip is worth $1.58B. Expedia reports on Thursday afternoon, and Priceline on the morning of Nov. 9.
Ctrip.com International Ltd. engages in the provision of travel-related services. It provides hotel accommodations, airline tickets, packaged tours, corporate travel management services, property management systems, and advertising services. The company was founded by Jian Zhang Liang, Min Fan,... More
Industry: Consumer Services
Other News & PR