The Shanghai-based company is a travel service provider. Its stock price target was raised after Ctrip.com sold 25% of its voting interest to Baidu (BIDU) in exchange for 48% ownership in Qunar Cayman Islands (QUNR), Oppenheimer said.
The transaction will align Ctrip.com and Baidu's interests, the firm said.
"The deal represents the softer Chinese economy causing the leading internet companies to explore partnerships rather than compete at the expense of margin," the firm added.
Oppenheimer maintained its "outperform" rating on the stock.
Shares of Ctrip.com were down 5.81% to $85.51 in early afternoon trading on Tuesday.
Separately, TheStreet Ratings team rates CTRIP.COM INTL LTD as a Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:
We rate CTRIP.COM INTL LTD (CTRP) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its robust revenue growth, solid stock price performance and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including disappointing return on equity, feeble growth in the company's earnings per share and generally higher debt management risk.
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- CTRP's revenue growth has slightly outpaced the industry average of 46.3%. Since the same quarter one year prior, revenues rose by 46.8%. This growth in revenue does not appear to have trickled down to the company's bottom line, displaying stagnant earnings per share.
- Compared to its closing price of one year ago, CTRP's share price has jumped by 27.31%, exceeding the performance of the broader market during that same time frame. Although CTRP had significant growth over the past year, our hold rating indicates that we do not recommend additional investment in this stock at the current time.
- The gross profit margin for CTRIP.COM INTL LTD is currently very high, coming in at 71.11%. 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 5.64% compares favorably to the industry average.
- CTRIP.COM INTL LTD reported flat earnings per share in the most recent quarter. Earnings per share have declined over the last two years. We anticipate that this should continue in the coming year. During the past fiscal year, CTRIP.COM INTL LTD reported lower earnings of $0.21 versus $1.12 in the prior year. For the next year, the market is expecting a contraction of 5.7% in earnings ($0.20 versus $0.21).
- Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Internet & Catalog Retail industry and the overall market, CTRIP.COM INTL LTD's return on equity significantly trails that of both the industry average and the S&P 500.
- You can view the full analysis from the report here: CTRP