Priceline Flies Past Analyst Estimates

Shares of Priceline (NASDAQ: PCLN) are soaring in after hour trading, up $39.27 to $266.55 following an outstanding earnings report and raised guidance.   The company reported earnings per share of $3.09 on revenue of $767.4 million, comfortably beating analyst estimates of $2.65 in EPS on revenues of $733 million.  For guidance, Priceline expects EPS in the $4.78 to $4.98 range, well above the anticipated guidance of $4.18.

Following its less than stellar first quarter report in early May, shares of Priceline’s stock dropped to as low as $173.32, a full $100 below 52-week highs at $273.93.  Some had questioned whether new flight and travel search engines, like Microsoft’s (NASDAQ: MSFT) Bing, were winning over potential bookees from Priceline.  This second quarter earnings report should put any such questions to end.  We now know that Priceline’s impressive organic growth remains intact, and it seems much clearer that the weak 1st quarter did in fact result from external factors, like the Icelandic volcanic eruption which proved to be disruptive for people traveling to and from the European continent.

According to Priceline’s CEO, Jeffery H. Boyd:

“Second quarter performance by the Priceline group of companies was once again driven by strong growth in our global hotel reservations, where we believe we gained market share for another quarterThe group achieved a combined 48% year-over-year growth in hotel room nights booked.  International gross travel bookings increased by 59% compared to prior year, or 67% on a local currency basis, due to increasing travel demand and an improvement in room rates.  Domestic gross travel bookings grew by 20% driven by strong growth in hotel reservations.  Growth in airline tickets and domestic rental car days was modest as our Name Your Own Price® airline and rental car services were hampered by reductions in capacity by suppliers.”

Shares of Priceline should open just beneath 52-week highs tomorrow, marking an impressive 50% rally off of recent lows.

priceline bounces back nicely from a 1q earnings report swoon.