Editors Note: This article has been updated to reflect Priceline's adjusted net income and updated stock price.
NEW YORK (TheStreet) -- Priceline Group (PCLN) shares are up 0.7% to $1,140 on Thursday after beating analysts first quarter earnings estimates while lowering its second quarter guidance below analysts estimates.
The online travel company posted adjusted net earnings, excluding certain items, of $331.2 million during the quarter, or $7.40 per share. Analysts were expecting $6.94 earnings per share for the quarter.
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The company set its second quarter earnings forecast to between $11.22 - $12.02 per share, below analysts estimates of $12.27 earnings per share on $2.1 billion in revenue.
As hotel, car rental and travel bookings increased in the first quarter so did revenue, up 26% from the previous year to $1.64 billion, beating analysts estimates of $1.63 billion.
TheStreet Ratings team rates PRICELINE GROUP INC as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:
"We rate PRICELINE GROUP INC (PCLN) a BUY. This is driven by several positive factors, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures, solid stock price performance, impressive record of earnings per share growth and expanding profit margins. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The revenue growth came in higher than the industry average of 1.6%. Since the same quarter one year prior, revenues rose by 29.4%. Growth in the company's revenue appears to have helped boost the earnings per share.
- Although PCLN's debt-to-equity ratio of 0.27 is very low, it is currently higher than that of the industry average. Along with this, the company maintains a quick ratio of 5.28, which clearly demonstrates the ability to cover short-term cash needs.
- Powered by its strong earnings growth of 26.82% and other important driving factors, this stock has surged by 70.10% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, although almost any stock can fall in a broad market decline, PCLN should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
- PRICELINE GROUP INC has improved earnings per share by 26.8% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, PRICELINE GROUP INC increased its bottom line by earning $36.01 versus $27.71 in the prior year. This year, the market expects an improvement in earnings ($51.52 versus $36.01).
- The gross profit margin for PRICELINE GROUP INC is currently very high, coming in at 86.10%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 24.53% significantly outperformed against the industry average.
- You can view the full analysis from the report here: PCLN Ratings Report
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