Ctrip.com International (CTRP) Is Today's Momo Momentum Stock

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

Trade-Ideas LLC identified Ctrip.com International ( CTRP) as a momo momentum candidate. In addition to specific proprietary factors, Trade-Ideas identified Ctrip.com International as such a stock due to the following factors:

  • CTRP has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $181.3 million.
  • CTRP has a PE ratio of 70.4.
  • CTRP is currently in the upper 30% of its 1-year range.
  • CTRP is in the upper 25% of its 20-day range.
  • CTRP is in the upper 35% of its 5-day range.
  • CTRP is currently trading above yesterday's high.
  • CTRP has experienced a gap between today's open and yesterday's close of 1.5%.

'Momo Momentum' stocks are valuable stocks to watch for a variety of reasons including historical back testing and price action. Market technicians refer to such stocks as being in a mark-up phase before a possible distribution period and price decline. Technical analysts and traders frequently find that the factors referenced above tend to create a temporary burst of strong wind in a stock's sail. Nevertheless, all successful traders must excel at maximizing gains while keeping losses to an absolute minimum. For that reason, the holding period on momo momentum stocks must always be a primary consideration, and this part of the puzzle is ultimately at the discretion of each individual's risk tolerance and portfolio risk management skills.

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More details on CTRP:

Ctrip.com International, Ltd., together with its subsidiaries, provides travel service for hotel accommodations, airline tickets, packaged tours, and corporate travel management in the People's Republic of China. The stock currently has a dividend yield of 0.6%. CTRP has a PE ratio of 70.4. Currently there are 9 analysts that rate Ctrip.com International a buy, no analysts rate it a sell, and 3 rate it a hold.

The average volume for Ctrip.com International has been 2.3 million shares per day over the past 30 days. Ctrip.com International has a market cap of $7.1 billion and is part of the services sector and leisure industry. Shares are up 142.4% year to date as of the close of trading on Monday.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12-months. Learn more.

TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Ctrip.com International as a buy. 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, expanding profit margins and growth in earnings per share. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.

Highlights from the ratings report include:
  • The revenue growth came in higher than the industry average of 17.4%. Since the same quarter one year prior, revenues rose by 32.3%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • CTRP's debt-to-equity ratio is very low at 0.22 and is currently below that of the industry average, implying that there has been very successful management of debt levels. To add to this, CTRP has a quick ratio of 1.65, which demonstrates the ability of the company to cover short-term liquidity needs.
  • Powered by its strong earnings growth of 84.61% and other important driving factors, this stock has surged by 171.13% 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, 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 75.17%. 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 16.89% significantly outperformed against the industry.
  • CTRIP.COM INTL LTD reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, CTRIP.COM INTL LTD reported lower earnings of $0.80 versus $1.13 in the prior year. This year, the market expects an improvement in earnings ($0.91 versus $0.80).

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12-months. Learn more.

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