Ctrip.com International, Ltd. (CTRP) recently hit a new multi-year high above $53 after the company reported an awesome Q3 earnings surprise of 29% in early November. With a bullish next-year estimate and high industry rank, this Zacks #1 rank stock provides international flavor to the momentum faction.

Company Description

Ctrip.com Int. Ltd., together with its subsidiaries, provides a range of travel services from hotels to airline tickets in China. The company was founded in 1999 and has a market cap of $6.66 billion.

China has been a leader in the global economic rebound of the last 18 months, showing huge gains in GDP that continue to enrich its middle class. That dynamic was on display on Nov 4 when the company reported strong Q3 results that came in ahead of expectations.

Third-Quarter Results

Revenue for the period was up 48% from last year to $129 million. Earnings also came in strong at 31 cents, 29% ahead of the Zacks Consensus Estimate, where the company has an average earnings surprise of 15% over the last four quarters.

The strong results were driven by hotel rentals, where sales were up 36% from last year to $52 million on a 30% increase in volume. Air tickets were also strong, also up 36% from last year to $47 million.

Not only did Ctrip see big sales gains, its gross margin reveals a highly profitable business, coming in 78%, up 100Bps from last year.

Tons of Cash, No Debt

Ctrip emerged from the quarter with its pristine balance sheet in great shape, with its cash and equivalents up $93 million from last year to $275 million.

Estimates

We saw some pretty solid movement in estimates on the good quarter, with the current year up 7 cents to $1.01 and the next-year estimate up 6 cents to $1.29, a bullish 28% growth projection.

Valuation

In light of recent gains, CTRP’s forward P/E of 50X is a sharp premium to the industry average of 16X.

2-Year Chart

On the chart, CTRP recently hit a new multi-year high above $53 before pulling back a bit on general market volatility. But in spite of the gains, the stochastic below the chart is signaling that shares are trading near over-sold territory. Look for support from the long-term trend line on any weakness.

CTRP: Ctrip.com International, Ltd. > <I>Michael Vodicka is the Momentum Stock Strategist for Zacks.com. He is also the Editor in charge of the new <a href=Zacks Momentum Trader Service.
 
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