Priceline.com's (NASDAQ:PCLN) looking skyward these days, up 16% this morning to $25 a stub. It's a bit too simple to attribute all the dot-com's success to its judicious use of B.S. Sure, Bill Shatner's TV ad (What did you think I was talking about?) with Leonard Nimoy garnered Priceline some campy retro buzz, but Priceline's making the right moves where it counts.

The latest results for 2003 reveal a company that's gotten lean and mean, despite a dip in revenues. Fourth-quarter gross bookings were up, although revenues were down 8.7% compared to last year. But the company managed to reverse last year's loss of $0.20 a share and posted earnings of $0.06.

Management said results were buoyed by the firm's new airline ticket service, which allows disclosed itinerary fares, akin to the service offered by rivals Orbitz (NASDAQ:ORBZ), InterActiveCorp's (NASDAQ:IACI) Expedia and Sabre's (NYSE:TSG) Travelocity. However, there was strong growth in hotel and car rental bookings (37% and 62%, respectively). As Rick Munarriz pointed out, an unseemly one-for-six reverse split notwithstanding, Priceline is flourishing through careful diversification.

For the full year, Priceline.com notched earnings of $0.27 a share, against 2002's $0.57 loss. Nicely done. But I suggest that prospective shareholders should keep an eye on the revenues, which were down 13.9% to $863.7 million.

Making money on shrinking sales is great, but making money on more is better. And even a third-grader can do this math. Priceline's trailing P/E currently runs north of 90. Estimates of $0.75 for 2004 put it at a forward P/E of 33. That's cheap if you believe the near 200% growth assumed in that read of the tea leaves. But it looks pricey for a company with flagging sales that competes in a cutthroat arena like discount travel. Choose your path wisely.

Get travel tips at our Travel Center, or try the Fool's Cheap Air Fares discussion board.

Motley Fool contributor Seth Jayson thinks Priceline's next ad should reprise the famous Star Trek "Amok Time" episode, and let Bill and Leonard fight it out for the spokesman slot. He does not own shares of any company mentioned in this article.