Priceline's Price Target Is Now $1,750 At Barclays
Priceline Group Inc (NASDAQ: PCLN) reported solid Q3 results, with room-night growth and non-GAAP operating margins ahead of expectations. The company’s Q3 beat and higher guide “not only reflects market share gains for Booking.com in the U.S. but generally strong execution in all geos - particularly in Asia,” Barclays’ Christopher D. Merwin said in a report.
Merwin maintained an Overweight rating on Priceline, while raising the price target from $1,550 to $1,750. He raised the full-year EPS estimate from $63.78 to $64.29.
Solid Room Night Growth
The company achieved 29 percent room-night growth, significantly ahead of Barclays’ estimate of 22 percent. Management guided to 22.5 percent growth at the mid-point for Q4. Although the guidance was in-line with expectations, this is “encouraging given Priceline's history of conservative guidance,” Merwin stated.
Priceline confirmed it had gained share in the US. The company’s strength in Europe and Asia should not to be overlooked, since International gross profit growth came in at 25 percent year-over-year, the analyst pointed out.
“Agoda showed accelerating growth in the quarter, and coupled with Kayak's expansion into Asia Pac, we think Priceline is very well positioned to benefit from the long-term structural growth of that market, which we think further extends the runway for 20%+ room night growth,” Merwin wrote. He added that the company exhibited better-than-expected advertising efficiency in Q3.
Latest Ratings for PCLN
Date | Firm | Action | From | To |
---|---|---|---|---|
Feb 2018 | Deutsche Bank | Maintains | Hold | Hold |
Jan 2018 | Wells Fargo | Maintains | Market Perform | Market Perform |
Dec 2017 | MKM Partners | Downgrades | Buy | Neutral |
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