NEW YORK (TheStreet) -- Ctrip.com (CTRP - Get Report) shares are up 8% to $49.40 on Thursday after surpassing analysts revenue expectations during the first quarter earnings period.
The Chinese travel company reported revenues of $254.5 million, an increase of 36% from the previous year, beating analysts estimates of $244.2 million.
The company's net income of 12 cents per share was in line with analysts EPS guidance.
TheStreet Ratings team rates CTRIP.COM INTL LTD as a Buy with a ratings score of B-. TheStreet Ratings Team has this to say about their recommendation:
"We rate CTRIP.COM INTL LTD (CTRP) a BUY. This is driven by some important positives, 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, solid stock price performance, expanding profit margins, largely solid financial position with reasonable debt levels by most measures and growth in earnings per share. 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 greatly exceeded the industry average of 1.6%. Since the same quarter one year prior, revenues rose by 35.7%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- Investors have apparently begun to recognize positive factors similar to those we have mentioned in this report, including earnings growth. This has helped drive up the company's shares by a sharp 118.19% over the past year, a rise that has exceeded that of the S&P 500 Index. Regarding the stock's future course, although almost any stock can fall in a broad market decline, CTRP should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
- The gross profit margin for CTRIP.COM INTL LTD is currently very high, coming in at 72.70%. Regardless of CTRP's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, CTRP's net profit margin of 18.11% significantly outperformed against the industry.
- CTRP's debt-to-equity ratio of 0.75 is somewhat low overall, but it is high when compared to the industry average, implying that the management of the debt levels should be evaluated further. Despite the fact that CTRP's debt-to-equity ratio is mixed in its results, the company's quick ratio of 2.06 is high and demonstrates strong liquidity.
- CTRIP.COM INTL LTD has improved earnings per share by 11.1% 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 year. However, we anticipate underperformance relative to this pattern in the coming year. During the past fiscal year, CTRIP.COM INTL LTD increased its bottom line by earning $1.12 versus $0.80 in the prior year. For the next year, the market is expecting a contraction of 20.5% in earnings ($0.89 versus $1.12).
- You can view the full analysis from the report here: CTRP Ratings Report