Priceline (PCLN - commentary - Trade Now) is up over 12% on very heavy trade following the company's second-quarter earnings report. The company released its latest report before the bell this morning, sparking a powerful breakaway gap that lifted shares $12.00 higher. Priceline's reportincluded a 12.8% increase in year-over-year gross travel bookings as well as a year-over-year gross profit jump of 20.3%.
Within the first few minutes of trading, Priceline was surging above its 2008 highs left behind last May. Volume is running extremely heavy and is already triple the stock's daily average. Final volume figures will likely rival February's, when the stock broke out with a 16% gain.
PCLN Daily (Nasdaq) Priceline
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PCLN Weekly (Nasdaq) Priceline
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Today's breakout comes on the heels of a very strong advance for Priceline since it left behind a double-bottom near $103.00. The stock is now up over 40% since the July 7 lows and is getting a bit overextended in the short term. I expect the stock's breakout to carry it higher, but a pullback will be needed soon. I doubt if a retest of the previous August highs is in the cards within the next few weeks. More likely is a new base forming between the $140.00 to $144.00 area. I am very hesitant to chase at this point but would be a buyer on weakness.
At the time of publication, Morrow had no positions in the stocks mentioned.
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