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Priceline.Com Q1 Earnings To See Significant Growth On Industry Demand, Outlook In Focus

 May 08, 2012 03:43 PM

(By R. Chandrasekaran) Online travel company Priceline.com (Nasdaq: PCLN) will report its first quarter earnings results after the market closes on May 9. The company's results will likely reflect its improved market share in the U.S. and its efforts to grow significantly in Asia.

The company is expected to gain from favorable conditions in the travel industry as the economy showed moderate signs of improvement.. If rival Expedia's (Nasdaq: EXPE) recent quarter results are of any indication, Priceline.com is set to report another quarter of strong earnings that could top analysts' estimations easily.

[Related -Expedia Inc (NASDAQ:EXPE): A Look At Underappreciated Meta-Search Asset]

Its hotel business is likely to witness sustained gains driven by significant expansion in Asia; although, the European Union crisis partially offsetting gains cannot be ruled out.

The company's earnings per share could experience upside of 48.5 percent amidst revenue growth of 29 percent. Priceline.com offers  travel reservations, room reservations, car rentals, and airline ticket sales..

Currently, Wall Street analysts expect the company to deliver earnings of $3.95 a share and revenues of $1.04 billion for the first quarter. Last year, Priceline.com earned $2.66 a share on revenue of $809.32 million.

While reporting fourth quarter results, the company guided first quarter adjusted earnings to $3.80 - $3.90 a share. Revenue was projected to witness upside of 22 – 27 percent year-over-year.

[Related -Priceline.com Inc (PCLN): Goldman Says PCLN Is Booking A Trip To $1,500]

Analysts seem upbeat about the company's earnings results. As can be seen by upward EPS estimates revisions to $3.95 a share from $3.75 a share three months back and from $3.94 a share a week ago. Interestingly, the company's earnings have come in above Street expectations in all the preceding four quarters.

Meanwhile, rival Expedia recently reported that it earned an adjusted profit of $36.9 million, up 61.84 percent from $22.8 million, and earnings surged 62.5 percent to 26 cents a share from the previous year quarter's 16 cents a share. However, on a GAAP basis, the company incurred a loss of $3.28 million or 2 cents loss a share versus profit of $52.04 million or 37 cents a share in the year earlier quarter. Revenues advanced 12.2 percent to $816.5 million over last year's $727.8 million. Both adjusted earnings and revenues exceeded Street predictions.

In the fourth quarter, Priceline.com earned an adjusted profit of $276.8 million versus $175 million and earning per share surged to $5.37 from the previous year quarter's $3.40. Revenues grew 35.5 percent to $990.8 million. Both earnings and revenues were more than analysts expected.

In the 52-week period, shares of Priceline.com hit a high of $774.96 and a low of $411.26. Shares of the company advanced 24.7 percent based on May 7th's closing price of 737.65, while the Nasdaq shed a marginal 0.28 percent.

Meanwhile, Nomura reportedly upgraded the stock to Neutral from Reduce just ahead of PCLN's first quarter results announcement.

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