Ctrip.com International (CTRP) Is Today's Storm The Castle Stock

Trade-Ideas LLC identified Ctrip.com International ( CTRP) as a "storm the castle" (crossing above the 200-day simple moving average on higher than normal relative volume) 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 $138.0 million.
  • CTRP has traded 2.0 million shares today.
  • CTRP is trading at 1.93 times the normal volume for the stock at this time of day.
  • CTRP crossed above its 200-day simple moving average.

'Storm the Castle' stocks are worth watching because trading stocks that begin to experience a breakout can lead to potentially massive profits. Once psychological and technical resistance barriers like the 200-day moving average are breached on higher than normal relative volume, the stock is then free to find new buyers and momentum traders who can ultimately push the stock significantly higher. Regardless of the impetus behind the price and volume action, when a stock moves with strength and volume it can indicate the start of a new trend on which early investors can capitalize on. In the event of a well-timed trading opportunity, combining technical indicators with fundamental trends and a disciplined trading methodology should help you take the first steps towards investment success.

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More details on CTRP:

Ctrip.com International, Ltd., together with its subsidiaries, provides travel service for accommodation reservation, transportation ticketing, packaged tours, and corporate travel management in the People's Republic of China. CTRP has a PE ratio of 4. Currently there are 8 analysts that rate Ctrip.com International a buy, no analysts rate it a sell, and none rate it a hold.

The average volume for Ctrip.com International has been 4.7 million shares per day over the past 30 days. Ctrip.com International has a market cap of $20.2 billion and is part of the services sector and leisure industry. Shares are down 5.7% year-to-date as of the close of trading on Friday.

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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, solid stock price performance, expanding profit margins, largely solid financial position with reasonable debt levels by most measures and notable return on equity. We feel its strengths outweigh the fact that the company has had sub par growth in net income.

Highlights from the ratings report include:
  • CTRP's very impressive revenue growth exceeded the industry average of 46.7%. Since the same quarter one year prior, revenues leaped by 73.5%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • Compared to its closing price of one year ago, CTRP's share price has jumped by 28.19%, exceeding the performance of the broader market during that same time frame. 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 72.81%. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of -37.78% is in-line with the industry average.
  • Despite currently having a low debt-to-equity ratio of 0.55, it is higher than that of the industry average, inferring that management of debt levels may need to be evaluated further. Regardless of the somewhat mixed results with the debt-to-equity ratio, the company's quick ratio of 0.86 is weak.
  • The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. In comparison to the other companies in the Internet & Catalog Retail industry and the overall market, CTRIP.COM INTL LTD's return on equity is significantly below that of the industry average and is below that of the S&P 500.

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