This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Priceline, Orbitz Take Off

A pair of online travel agencies, priceline (PCLN - Get Report) and Orbitz (ORBZ), announced fourth-quarter earnings that topped Wall Street estimates and showed much improvement from last year's results.

The strong reports came on the heels of InterActiveCorp's (IACI - Get Report) bullish comments Monday on the travel business. Shares of priceline and Orbitz rallied in postclose trading Tuesday.

Priceline reported net income of $2.2 million, or 6 cents a share, topping the 4 cents expected by Wall Street and the net loss of $7.4 million, or 20 cents, it had a year ago. Net revenue, which excludes all fees and taxes as well as "Name Your Own Price" sales, came in at $180.2 million, down 8.7% from a year ago.

Gross travel bookings, which includes taxes and fees as well as the purchase price of travel, including those "Name Your Own Price" sales, came in at $256.2 million, a 12.2% increase from last year. Gross profit came in at $31.8 million, up 4.4% from last year, while gross margin rose to 17.7% from the year-ago 15.5%.

"The growth in total gross travel bookings and gross profit reflects a successful transition of our airline ticket business and a positive bottom-line financial result, before any new benefit from new airline ticket advertising," said Jeffery Boyd, priceline's CEO.

Indeed, priceline's move beyond airfare reaped some benefit in the fourth quarter. The company said that bookings of hotel rooms rose 37% year over year, while car rental sales rose 62%. That said, airfare sales continued their decline, dropping 18% year over year, which is an improvement from the drop of 40% seen in the first nine months of fiscal 2003.

Going forward, priceline said it was hopeful that the new pairing of William Shatner and Leonard Nimoy as company pitchmen would boost sales and reverse the slide in airfare sales. In the first quarter, the company said that earnings would come in between 6 cents and 10 cents a share, toward the high end of the 7-cent profit currently expected by Wall Street.

1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Submit an article to us!
SYM TRADE IT LAST %CHG
IACI $71.72 0.00%
PCLN $1,267.46 0.00%
AAPL $128.32 -0.30%
FB $78.72 -0.11%
GOOG $540.78 0.00%

Markets

DOW 18,070.40 +46.34 0.26%
S&P 500 2,114.49 +6.20 0.29%
NASDAQ 5,016.9290 +11.5380 0.23%

Partners Compare Online Brokers

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs