As for industry operators, they naturally want to go where the customers are. Customers gravitate toward the bigger platforms, since size means more choices and better deals. Scale is a key source of competitive strength in the industry. This includes not only hotel rooms, but also rooms in homes and apartments. Across its different platforms, Priceline covers approximately 23.7 million potentially bookable rooms. Priceline's main platform,, includes nearly 493,000 vacation rental properties available to customers, growing by 39% year over year during the second quarter of 2016. On the other hand, global markets also offer superior growth opportunities, and Priceline has downright crushed Expedia when it comes to revenue growth over the last decade. Big international exposure can make financial performance hard to predict on a quarter-to-quarter basis, since currency volatility can have a considerable impact on both sales and earnings. While Expedia is mostly focused on the U.S., Priceline made nearly 86% of its gross bookings from international markets last quarter. This means that Priceline is more than 20% bigger than Expedia in terms of sales. Priceline's closest competitor is Expedia ( EXPE 2.55%), which is expected to generate $8.76 billion in revenue this year. The company is expected to make nearly $10.64 billion in sales during 2016. Priceline is the biggest player among OTAs. In addition, Priceline has an impressive track record of performance over the long term, and the stock is fairly reasonably valued.Īccording to the report, as quoted by Street Insider: "Through, Priceline offers scale advantage, characterized by its leading global position in travel and deep penetration of independents and the European OTA market (both above 50% currently), execution track record, and value." Does it make sense? This can be a valuable source of competitive strength in the business. The company has a leadership position among online travel agencies (OTAs), especially in Europe and other international markets. The bullish thesisĮvercore analyst Ken Sena has a simple and straightforward bullish thesis for Priceline. That being said, there is nothing wrong with paying attention to what analysts have to say about a company, as it could offer valuable insight on a particular investment. This means that investors should always do their own homework as opposed to blindly following recommendations from Wall Street. Professional analysts can make mistakes just like everyone else (in fact, they often do). Among the 30 analysts currently following the company, 23 of them rate it as a buy or strong buy, with seven analysts rating Priceline as hold, and there are no underperform or sell recommendations on Priceline as of the time of this writing. From current price levels, this would mean an upside potential of nearly 17% toward Evercore ISI's price target for Priceline.Įvercore ISI is not alone in its bullish view of Priceline stock. 22, as Evercore ISI upgraded the company to a buy recommendation, raising its target price by over 22%, from $1,350 to 1,650. Priceline Group ( BKNG 1.47%) stock received a big thumbs-up from Wall Street on Aug.
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