It was a good day to be a travel portal. Between Priceline.com's
Priceline hit the runway first. Revenue climbed 15% to $462.1 million, and would have been even higher if not for the stronger dollar watering down overseas gains and travel providers marking their available offerings. The company gained market share across the board by booking 36% more room nights, 15% more car rental days, and 28% more flights.
The bottom line was another winner, with pro forma profits clocking in at $1.09 a share, well ahead of both the $0.76 a share it earned a year ago and the $0.91 a share that Wall Street was targeting. Priceline has now beaten analyst guesstimates for 12 consecutive quarters. The stock rose 4% during an otherwise down day, and deservedly so.
Ctrip then stepped up after the market's closing bell. China's leading travel portal delivered $58.6 million in net revenue, 18% above last year's showing. The company had particularly strong gains in air ticketing and packaged tours.
Net income climbed 23% to $0.26 a share, blowing past market expectations of $0.21 a share. Sure, a big chunk of the surprise came as a result of the company paying a substantially lower effective tax rate. However, even the 8% gain in pre-tax profits is seemingly still ahead of where the pros were perched.
The double shot of good news comes days after the rest of the industry's publicly traded players reported.
(NYSE:OWW)was barely profitable after charges.
(NASDAQ:EXPE)delivered lower earnings than it did a year ago.
(NASDAQ:TZOO)did surprise investors with a profit, but it's a far cry from what the travel deals publisher was generating in its prime.
However, all three stocks took off after reporting, since their seemingly blah results actually topped Mr. Market's projections. China's Universal Travel Company (OTC BB: UTVL.OB) announced healthy growth last week, and the country's eLong
So why are investors afraid of the travel sites? If they toughed it out during the abysmal months of January, February, and March, and generally clocked in ahead of expectations, just imagine what they can achieve when the economy bounces back.