UPDATE: Brean Murray Carret Downgrades Ctrip.com

According to a research report published earlier today, Brean Murray Carret has downgraded Ctrip.com International's (NASDAQ: CTRP) stock from Hold to Sell.

Brean Murray Carret explained the decision in the report: “While CTRP reported largely in‐line 4Q results and largely in‐line 1Q revenue guidance, we continue to see mounting pressure on its margin outlook in the coming quarter and in FY2012. What concerns us most is the structural change that the company is going through; we believe factors that are pressing its margins are unlikely to go away anytime soon (labor cost pressure, profit giving‐back to attract leisure segment and increasing investment upon competition). We expect the company's earnings growth will be muted in 2012 with limited upside over the next 12 months. Earnings growth thereafter will likely remain challenging. Therefore, we are downgrading CTRP shares to Sell with a target price of $19, implying 23% downside from the current level.”

Ctrip.com closed Friday at $24.69.