The Priceline Is Right

You know we're living in remarkable times when Priceline.com (Nasdaq: PCLN  ) is able to complete a rocky roundtrip that took the online travel specialist from boom to bust and back to boom again. Even though investors pummeled the stock for a 25% loss today, there is still reason to be optimistic about the future.

Yes, the same "name your own price" company that dazzled the market with William Shatner's vocal performances during the dot-com mania before being grounded to penny-stock pulp is back. OK, so maybe it cheated along the way with a reverse stock split, but the important thing is that the company has arrived. And, yes, Priceline has arrived.

Last night the company posted third-quarter earnings of $0.24 a share on a 9% uptick in gross travel bookings. That reversed last year's third-quarter loss. Yet the real nugget here is how well it continues to diversify off its air-travel roots.

The company booked a record 1.6 million hotel nights and 1.1 million car rental days. That represents a more than 40% improvement in those categories over the past year. So while the terminal expansion of discount carriers such as JetBlue (Nasdaq: JBLU  ) and Southwest (NYSE: LUV  ) has made Priceline's bargain-priced airfare deals less popular, it has become more proficient in other travel-related areas.

Even the company's mortgage business, which was once ridiculed as an example of "diworsification," had a strong showing as rock-bottom interest rates fueled the home-buying market.

Sensing continued weakness in its airline business, Priceline will be advertising its repositioned airfare services more aggressively over the next couple of quarters. While that kind of warning may alarm investors, it would be wrong for that to overshadow the company's gains in higher-margin offerings.

Yes, Priceline has arrived. The only difference is that the arrival gate has been changed.

Have you made a trek out to our Travel Center yet? Either way, have you ever used Priceline to book your travel? What did you think? Have any other tips to share on bargain flights? All this and more -- in the Cheap Air Fares discussion board. Only on Fool.com.