| Stock (Symbol) | Stock Price | |||||||||||||||||||||||||||||
Priceline.com (PCLN) |
$341 |
|||||||||||||||||||||||||||||
| Data is as of | Expected to Report | Sector | ||||||||||||||||||||||||||||
September 23, 2010 |
Nov 8 |
Technology |
||||||||||||||||||||||||||||
| Company Description | ||||||||||||||||||||||||||||||
| priceline.com Incorporated (priceline.com) is an online travel company, which offers a range of travel services, including hotel rooms, car rentals, airline tickets, vacation packages, cruises and destination services. Internationally, the Company offer customers hotel room reservations in over 90 countries and 32 languages. In the United States, priceline.com offer the customers the ability to purchase travel services in a price-disclosed manner or the opportunity to use the Name Your Own Price service, which allows the customers to make offers for travel services at discounted prices. The subsidiaries of the Company include Lowestfare.com LLC and Travelweb LLC. In May 2010, the Company acquired TravelJigsaw LTD. | ||||||||||||||||||||||||||||||
| Sharek’s Take | ||||||||||||||||||||||||||||||
 Priceline.com has gone from $195 to $341 since last quarter. The reason for the rise is a reversal of fortune. Last quarter PCLN had earnings estimates lowered because of turmoil overseas — namely the European debt crisis, volcanic ash in Iceland and rioting in Thailand. Then when PCLN beat those lowered estimates it turned the tide up and the stock’s jumped around $100 as estimates increased. All is not good however, as PCLN’s P/E of 28 may be the highest I’ve seen it since I first purchased the stock in the Growth Portfolio in May 2006. For the record the P/E was 18 and the stock was $29. Wish I would have bought (and held) more. |
||||||||||||||||||||||||||||||
| One-Year Chart | ||||||||||||||||||||||||||||||
| I don’t like the technicals on this one year chart. After earnings were announced in August the stock broke out past $230 and now its $341. There hasn’t been a significant correction since $175 so be leery of investing before the stock corrects. Although I’m not bearish on PCLN — and don’t recommend you sell any — I just feel this run is done. The mountain is too steep. The stock is double it’s 200 day moving average, that’s often a time when the best stocks lose steam. |  |
|||||||||||||||||||||||||||||
| Profit Growth | Earnings Table | |||||||||||||||||||||||||||||
| Profits grew and amazing 53% last quarter. Revenue was expected to be $733 million — PCLN came in with $7.67 million, up 27% from last year. |  |
|||||||||||||||||||||||||||||
| Beat the Street | ||||||||||||||||||||||||||||||
| PCLN whipped estimates by 44 cents. Last quarter these estimates got lowered by 16 cents so the company more than made up the difference. | ||||||||||||||||||||||||||||||
| Annual Profit Estimates | ||||||||||||||||||||||||||||||
| I think the real reason the stock flew from $195 to $341 since last quarter is at the time annual estimates had just declined. Now these figures jumped. Its a reversal of fortune. | ||||||||||||||||||||||||||||||
| Future Quarters | ||||||||||||||||||||||||||||||
| NxtQtrEst jumped an astounding 79 cents. PCLN loves to up and beat estimates. So I think 40% growth could be here for the foreseeable future. | ||||||||||||||||||||||||||||||
| Fair Value | ||||||||||||||||||||||||||||||
| I almost put PCLN’s fair value at 35 times earnings. But that’s too high for this stock historically. Also I think a correction is due. 30 times earnings is great for this stock. |
|
|||||||||||||||||||||||||||||
| Ten-Year Chart | ||||||||||||||||||||||||||||||
| This is the first quarter PCLN’s ten-year chart has looked so good. This stock was a darling during the late-90s tech stock boom. Then when things went bust in 2000, so did PCLN stock. 2004 was the year to get in to PCLN, as profits of $0.93 were more than double the previous high of $0.44. |  |
|||||||||||||||||||||||||||||
| Power Ranking | Bottom Line | |||||||||||||||||||||||||||||
Growth Portfolio
3 of 17 |
This stock is in a zone right now, the trouble I’m having is the P/E is higher than I can recall and the stock is REALLY extended. I love PCLN but would not recommend new investors buy until the stock bases or corrects. Priceline.com is the 3rd best stock in the seventeen stock Growth Portfolio as this portfolio tries to stay moderately aggressive. PCLN is the top stock in the Aggressive Growth Portfolio because this portfolio likes to let winners run — and Priceline’s on a great run. | |||||||||||||||||||||||||||||
Aggressive Growth Portfolio
1 of 10 |
||||||||||||||||||||||||||||||
