Ctrip.com was blown up on "not good enough" guidance back in November [Nov 18, 2008: Not a Good Week for Chinese "Dot Coms"] but at that point anything that walked was getting whacked. This stock always seems to react violently, up or down, post earnings. I closed out our position in early September in the mid $40s - as with everything else it was trashed in the fall and late winter, but after a solid earnings report it made it back to $42 Tuesday before dropping back to the mid $30s. The one issue I've always had with the stock is a premium valuation and already we are back at 35x forward earnings for 2009.
Quick summary via AP
- U.S.-traded shares of Ctrip.com International Ltd. soared Tuesday after the China-based travel services provider posted solid results for the first quarter. The company late Monday announced quarterly net income of $18 million, or 26 cents per American Depositary share, up 23 percent from a year earlier. Excluding stock options costs, the company earned $22 million, or 32 cents per ADS.
- Revenue rose 18 percent to $59 million.
- Hotel reservation revenue rose 9 percent during the quarter to $27 million, while airline ticketing revenue grew 16 percent to $27 million.
- Ctrip expects second-quarter revenue to grow about 10 percent to 15 percent from a year earlier.
- Gross margins held in pretty well at 78% this year versus 80% last, but operating margins jumped 2 % to 34% year over year... unless you include stock based compensation (which we pretend doesn't count in America) so in that case operating margins were 40% versus 42% a year ago.
- The company benefited from some nice tax "changes": The effective tax rate for the first quarter of 2009 decreased to 18%, as compared to 28% in the same period of 2008 due to the application of the High and New Technology Enterprise ("HNTE") preferential treatment to certain of Ctrip's PRC subsidiaries.
- Hotel reservation revenues amounted to RMB187 million (US$27 million) for the first quarter of 2009, representing a 9% increase from the same period in 2008 primarily driven by a 17% increase in hotel room reservation volume, which was partially offset by a decrease in commission per room. Hotel reservation revenues represented an 11% decrease from the previous quarter primarily due to decreased hotel booking volume during the Chinese New Year holidays.
- Air-ticketing revenues for the first quarter of 2009 were RMB184 million (US$27 million), representing a 16% increase from the same period in 2008 primarily driven by a 40% increase in air-ticketing sales volume, which was partially offset by a decrease in commission per ticket. Air-ticketing revenue increased 11% from the previous quarter primarily due to increased air-ticketing volume.
- Packaged-tour revenues for the first quarter of 2009 were RMB38 million (US$6 million), up 41% from the same period in 2008 and 25% from the previous quarter, primarily due to the increased leisure travel volume in the first quarter of 2009.
[Aug 14, 2008: Interesting Stock Reaction to Ctrip.com's Report]
[May 15, 2008: Ctrip.com Down on Earnings - I'm Buying]
[Feb 28, 2008: Ctrip.com Continues to Impress]
[Jan 5, 2008: Zachstocks on Ctrip.com]