Shares of Norwalk-based Priceline.com Inc. surged today after the online travel retailer’s adjusted fourth-quarter profit beat Wall Street’s expectations and the company issued a better-than-expected first-quarter outlook.
At 11 a.m., Priceline shares traded at $80.38, up $11.64, or 16.9 percent. The stock has traded between $45.15 and $144.34 during the past 52 weeks.
Late Wednesday, Priceline reported that its quarterly earnings rose 1 percent to $33.3 million, or 73 cents per share. Excluding some one-time items, quarterly earnings per share totaled $1.29. Priceline’s revenue jumped 21 percent to $406 million.
Analysts polled by Thomson Reuters, who generally exclude special items, expected a profit of $1.05 per share on revenue of $377.8 million.
Priceline’s fourth-quarter gross travel bookings grew 31 percent in the U.S., while international bookings, excluding the impact of foreign currency translation, rose 28 percent.
KeyBanc Capital Markets analyst Scott W. Hamann attributed the company’s domestic bookings growth to consumers searching for travel bargains, mostly through the company’s “Name Your Own Price” model.
“Additionally,” he said, “we believe that domestic gains in air tickets, hotel room nights and rental car days sold were largely a result of the company’s well-recognized advertising campaign, featuring William Shatner as the Negotiator, as well as (Priceline’s) enhanced inventory selection and reduced/eliminated booking fee structure.”
Priceline.com expects first-quarter revenue growth of 5 to 10 percent and adjusted earnings of between 85 cents and 95 cents per share.
Analysts forecast earnings of 81 cents per share.
“Despite the macroeconomic slowdown, we expect Priceline to continue to grow through domestic market share gains and a dominant international business,” said Piper Jaffray analyst Michael J. Olson in a note to investors. “Additionally, we believe management will manage the business to increase or maintain margins.”
He noted, however, that travel industry trends are likely to get worse before they improve. (AP)
