SINGAPORE, May 19, 2025 /PRNewswire/ -- Trip.com Group Limited (Nasdaq: TCOM; HKEX: 9961) ("Trip.com Group" or the "Company"), a leading global one-stop travel service provider of accommodation reservation, transportation ticketing, packaged tours, and corporate travel management, today announced its unaudited financial results for the first quarter of 2025.Key Highlights for the First Quarter of 2025 International businesses continued to demonstrate robust growth across all segments in the first quarter of ...

Trip.com Group Limited (TCOM) is scheduled to report first-quarter 2025 results on May 19, after market close. In the last reported quarter, TCOM’s earnings beat the Zacks Consensus Estimate by 15.4%.The company’s earnings beat the consensus mark in the last four quarters, the average being 30.4%.TCOM’s Q1 EstimatesThe Zacks Consensus Estimate for earnings is pegged at 86 cents per share, indicating a surge of 3.6% year over year. In the past 60 days, the estimate has remained stable. (Find the latest earni ...

Company Performance - Trip.com (TCOM) closed at $61.22, reflecting a +1.21% change from the previous day, outperforming the S&P 500, which fell by 0.77% [1] - Over the last month, Trip.com's shares increased by 12.96%, while the Consumer Discretionary sector gained 14.18% and the S&P 500 gained 11.54% [1] Earnings Projections - The upcoming EPS for Trip.com is projected at $0.86, indicating a 3.61% increase year-over-year [2] - Revenue is expected to reach $1.91 billion, representing a 15.93% increase compared to the same quarter last year [2] Fiscal Year Estimates - For the entire fiscal year, earnings are estimated at $3.44 per share, a decrease of 4.18% from the previous year, while revenue is projected at $8.45 billion, an increase of 14.02% [3] - Recent changes in analyst estimates are seen as indicators of the company's business outlook [3] Valuation Metrics - Trip.com has a Forward P/E ratio of 17.57, which is lower than the industry average of 18.53, indicating a discount [6] - The company has a PEG ratio of 1.08, compared to the industry average of 1.42, suggesting favorable valuation relative to growth [7] Industry Context - The Leisure and Recreation Services industry, part of the Consumer Discretionary sector, has a Zacks Industry Rank of 182, placing it in the bottom 27% of over 250 industries [8] - Stronger industry rankings correlate with better stock performance, with top-rated industries outperforming lower-rated ones by a factor of 2 to 1 [8]

Company Performance - Trip.com closed at $57.62, reflecting a -1% change from the previous trading session, underperforming compared to the S&P 500's gain of 2.03% [1] - Over the last month, Trip.com's shares decreased by 7.78%, while the Consumer Discretionary sector and the S&P 500 saw losses of 4.94% and 5.07%, respectively [1] Earnings Forecast - The upcoming earnings report is expected to show an EPS of $0.86, representing a 3.61% increase from the same quarter last year [2] - Revenue is projected at $1.91 billion, indicating a 15.93% growth compared to the previous year [2] Fiscal Year Estimates - For the entire fiscal year, earnings are estimated at $3.44 per share, a decrease of 4.18% from the prior year, while revenue is expected to reach $8.45 billion, an increase of 14.02% [3] - Recent changes in analyst estimates suggest a positive outlook for the company's business and profitability [3] Valuation Metrics - Trip.com has a Forward P/E ratio of 16.9, which is slightly lower than the industry average of 16.98 [6] - The company also has a PEG ratio of 1.04, compared to the industry average PEG ratio of 1.17 [7] Industry Context - The Leisure and Recreation Services industry, part of the Consumer Discretionary sector, holds a Zacks Industry Rank of 139, placing it in the bottom 44% of over 250 industries [8] - Historically, the top 50% rated industries outperform the bottom half by a factor of 2 to 1 [8]

Financial Performance - For Q4 2024, Trip.com Group reported net revenue of RMB12.7 billion (US$1.7 billion), a 23% increase year-over-year, driven by stronger travel demand [3]. - For the full year 2024, net revenue reached RMB53.3 billion (US$7.3 billion), representing a 20% increase from 2023 [4]. - Net income for Q4 2024 was RMB2.2 billion (US$300 million), compared to RMB1.3 billion for the same period in 2023 [22]. - Adjusted EBITDA for Q4 2024 was RMB3.0 billion (US$408 million), an improvement from RMB2.9 billion for the same period last year [5]. - Accommodation reservation revenue for Q4 2024 was RMB5.2 billion (US$709 million), a 33% increase from the same period in 2023 [6]. - Transportation ticketing revenue for Q4 2024 was RMB4.8 billion (US$655 million), a 16% increase year-over-year [8]. - Packaged-tour revenue for Q4 2024 was RMB870 million (US$119 million), a 24% increase from the same period in 2023 [10]. - Total revenue for the year ended December 31, 2024, was RMB 53,377 million (USD 7,313 million), representing an increase from RMB 44,562 million in 2023 [42]. - Net income attributable to Trip.com Group Limited for the year ended December 31, 2024, was RMB 17,067 million (USD 2,338 million), up from RMB 9,918 million in 2023, reflecting a growth of 72.5% [42]. - The company reported a gross profit of RMB 43,304 million (USD 5,934 million) for the year ended December 31, 2024, compared to RMB 36,389 million in 2023, indicating a year-over-year increase of 18.9% [42]. - Adjusted EBITDA for the year ended December 31, 2024, reached RMB 17,070 million, reflecting a margin of 32% [44]. - The total net income attributable to Trip.com Group Limited for the year ended December 31, 2024, was RMB 17,067 million, an increase from RMB 9,918 million in the previous year [44]. Assets and Liabilities - As of December 31, 2024, the balance of cash and cash equivalents was RMB90.0 billion (US$12.3 billion) [28]. - Total current assets increased to RMB 112,120 million (USD 15,360 million) as of December 31, 2024, from RMB 88,732 million in 2023, marking a growth of 26.4% [40]. - Cash, cash equivalents, and restricted cash rose to RMB 51,093 million (USD 7,000 million) by December 31, 2024, compared to RMB 43,983 million in 2023, an increase of 16.0% [40]. - The company’s total assets reached RMB 242,581 million (USD 33,233 million) as of December 31, 2024, up from RMB 219,137 million in 2023, reflecting an increase of 10.7% [40]. - The company’s total liabilities increased to RMB 99,099 million (USD 13,576 million) as of December 31, 2024, from RMB 96,131 million in 2023, a growth of 3.1% [40]. - Trip.com Group Limited's shareholders' equity rose to RMB 142,739 million (USD 19,555 million) as of December 31, 2024, compared to RMB 123,006 million in 2023, indicating an increase of 16.1% [40]. Shareholder Returns and Future Plans - The company plans to undertake a share repurchase program of up to US$400 million and an ordinary cash dividend of approximately US$200 million for the financial year 2024 [29]. - The company plans to continue expanding its market presence and investing in new technologies to drive future growth [44]. Earnings and Expenses - Operating expenses for the year ended December 31, 2024, totaled RMB 29,127 million (USD 3,991 million), compared to RMB 25,065 million in 2023, representing a rise of 16.3% [42]. - Earnings per ordinary share (diluted) for the year ended December 31, 2024, was USD 3.39, compared to USD 2.39 in 2023, an increase of 41.8% [42]. - Interest income decreased to RMB 517 million for the year ended December 31, 2024, down from RMB 593 million in the previous quarter [44]. Quarterly Performance - Net income for the three months ended December 31, 2023, was RMB 1,342 million, a significant increase from RMB 1,297 million in the previous quarter [44]. - Non-GAAP net income attributable to Trip.com Group Limited for the three months ended December 31, 2024, was RMB 3,038 million, up from RMB 2,675 million in the previous quarter [44]. - The company reported a diluted non-GAAP income per share of RMB 4.35 for the three months ended December 31, 2024, compared to RMB 4.00 in the previous quarter [44]. - The adjusted EBITDA margin for the three months ended December 31, 2023, was 28%, indicating a decrease from 36% in the previous quarter [44]. - The company’s income from operations for the year ended December 31, 2024, was RMB 14,177 million, compared to RMB 11,324 million in the previous year [44]. - The company’s equity in income of affiliates for the three months ended December 31, 2024, was RMB (359) million, compared to RMB (351) million in the previous quarter [44].

Core Insights - Trip.com Group Limited has filed its annual report on Form 20-F, which includes audited financial statements for the three years ending December 31, 2024, with the Securities and Exchange Commission on April 11, 2025 [1] - The annual report is accessible on the Company's investor relations website, and holders of the Company's securities can request a free copy [1] Company Overview - Trip.com Group Limited is a leading global one-stop travel platform that offers a comprehensive suite of travel products and services, catering primarily to travelers in Asia and increasingly worldwide [2] - The Company operates under various brands, including Ctrip, Qunar, Trip.com, and Skyscanner, and was founded in 1999, listed on Nasdaq in 2003, and on HKEX in 2021 [2] - The mission of the Company is "to pursue the perfect trip for a better world" [2]

Financial Performance - Total revenues increased by 122% from RMB20.0 billion in 2022 to RMB44.6 billion in 2023, and further by 20% to RMB53.4 billion (US$7.3 billion) in 2024[31] - Net income rose from RMB1.4 billion in 2022 to RMB10.0 billion in 2023, and reached RMB17.2 billion (US$2.4 billion) in 2024[31] - Net income for 2023 reached RMB 10,002 million, a significant increase from a net loss of RMB 3,269 million in 2020, reflecting a turnaround in financial performance[42] - The company reported a projected net income of RMB 17,227 million for 2024, indicating a year-over-year growth of approximately 72%[42] - Cash and cash equivalents increased to RMB 41,592 million in 2023, up from RMB 17,000 million in 2022, showcasing improved liquidity[42] - Total assets grew to RMB 219,137 million in 2023, compared to RMB 191,691 million in 2022, representing an increase of about 14.3%[42] - Total shareholders' equity rose to RMB 123,006 million in 2023, compared to RMB 113,019 million in 2022, marking an increase of approximately 8.8%[43] - The company anticipates a diluted earnings per share of RMB 14.78 for 2023, a significant recovery from a loss of RMB 5.40 per share in 2020[42] Revenue Breakdown - Accommodation reservation revenue was RMB7.4 billion, RMB17.3 billion, and RMB21.6 billion (US$3.0 billion) for the years 2022, 2023, and 2024, representing 37%, 39%, and 40% of total revenues respectively[32] - Transportation ticketing revenue was RMB8.3 billion, RMB18.4 billion, and RMB20.3 billion (US$2.8 billion) for the years 2022, 2023, and 2024, accounting for 41%, 41%, and 38% of total revenues respectively[34] - Packaged-tour revenue increased from RMB797 million in 2022 to RMB4.3 billion (US$594 million) in 2024[36] - Corporate travel revenue grew from RMB1.1 billion in 2022 to RMB2.5 billion (US$343 million) in 2024[37] - Other businesses, including online advertising and financial services, generated revenues of RMB2.5 billion, RMB3.5 billion, and RMB4.6 billion (US$634 million) for the years 2022, 2023, and 2024 respectively[38] Market and Growth Opportunities - The Asia-Pacific region is identified as a key growth area, benefiting from a shift from offline to online and mobile services[30] - The company is exploring market expansion opportunities, particularly in the travel and online services sectors, to enhance growth prospects[49] - The company is expanding its global presence through owned brands, direct investments, and strategic partnerships, focusing on enhancing content capabilities and user engagement[79] Operational Efficiency and Investments - The platform provided approximately 1.5 million global accommodation listings and offered flights from over 640 airlines as of December 31, 2024[28] - Over 90% of total transaction orders were executed through mobile channels for the year ended December 31, 2024[25] - The company plans to invest RMB 870 million in product development for 2023, up from RMB 567 million in 2022, reflecting a focus on innovation[43] - For the year ended December 31, 2024, the company invested RMB 13.1 billion (US$1.8 billion) in product development[78] Risks and Challenges - The company faces significant risks from global economic conditions, including potential adverse effects from geopolitical tensions and inflation[80] - General declines or disruptions in the travel industry, such as pandemics or geopolitical unrest, could materially affect the company's business and financial performance[81] - The company experienced a significant decline in travel demand during the COVID-19 pandemic, leading to substantial user cancellations and refund requests[86] - The company has incurred substantial indebtedness and may face challenges in generating sufficient cash to meet its debt obligations[73] - The company is exposed to risks associated with international operations, including compliance and reputational risks, which could increase costs and divert management attention[121] Regulatory Environment - The PCAOB has regained the ability to inspect registered public accounting firms in mainland China and Hong Kong, affecting the company's compliance status under the HFCAA[58] - The company is deemed an "Existing Issuer" under the Overseas Offering and Listing Measures and is not required to complete filing procedures for historical securities offerings[62] - The company has completed foreign debt registrations with the NDRC for all debt offerings subject to such requirements[63] - The company’s operations in China are governed by PRC laws and regulations, with all requisite permissions obtained for its core business activities[60] - The company may be required to obtain additional approvals in the future due to uncertainties in PRC laws and regulations[60] Shareholder and Equity Considerations - The weighted average ordinary shares outstanding increased to 652,859,211 in 2023 from 648,380,590 in 2022, indicating a slight dilution in shares[42] - The company may require additional capital due to changed business conditions or future developments, which could lead to dilution for shareholders[156] Legal and Compliance Issues - The company is subject to various laws across multiple jurisdictions, which may pose operational risks[74] - The company is subject to payment processing risks, including potential increases in fees and changes in regulations that could adversely impact revenues and operating expenses[128] - The company must comply with evolving privacy and data protection laws, including the General Data Protection Regulation in the EU, which imposes significant obligations and potential penalties[146] Strategic Acquisitions and Competition - Strategic acquisitions in the travel industry are planned, but they pose risks such as potential dilution of equity and challenges in integration, which could adversely affect business operations[94] - The company faces competition from both existing travel agencies and new entrants, which may impact market share and profitability if not managed effectively[105] Financial Health and Asset Management - The company recorded a significant amount of goodwill and indefinite lived intangible assets from strategic acquisitions, which may be subject to impairment charges[73] - As of December 31, 2024, the company's goodwill was recorded at RMB60.9 billion (US$8.3 billion), with no impairment charges recognized for 2022, 2023, and 2024 due to the absence of impairment indicators[103] - The company has limited experience in international markets, which may affect its ability to expand globally[164] Tax and Financial Regulations - The company benefits from preferential tax rates for certain subsidiaries recognized as "high and new technology enterprises," but these qualifications must be renewed every three years[132] - Dividends from foreign-invested enterprises to offshore holding companies are subject to a 10% withholding tax unless a tax treaty provides for a different rate[218] Inventory and Demand Management - The company faces inventory risk during peak holiday seasons due to the need to predict demand for hotel rooms and transportation tickets accurately[131] - The company may be adversely affected if it fails to predict the amount of inventory needed during peak seasons, leading to potential losses[131]

Core Viewpoint - The article discusses the reliability of brokerage recommendations, particularly focusing on Trip.com (TCOM), and highlights the potential misalignment of interests between brokerage analysts and retail investors [1][4][9]. Brokerage Recommendations - Trip.com has an average brokerage recommendation (ABR) of 1.11, indicating a consensus between Strong Buy and Buy, based on 19 brokerage firms' recommendations, with 18 being Strong Buy, representing 94.7% of all recommendations [2][4]. - Despite the favorable ABR, relying solely on this information for investment decisions may not be advisable, as studies suggest brokerage recommendations often fail to guide investors effectively [4][9]. Analyst Bias - Brokerage analysts tend to exhibit a strong positive bias in their ratings due to vested interests, with a ratio of five "Strong Buy" recommendations for every "Strong Sell" [5][9]. - This bias can mislead investors regarding the actual price direction of stocks, suggesting that brokerage recommendations should be used to validate independent research rather than as standalone indicators [6][9]. Zacks Rank Comparison - Zacks Rank, a proprietary stock rating tool, categorizes stocks from 1 (Strong Buy) to 5 (Strong Sell) and is based on earnings estimate revisions, which have shown a strong correlation with near-term stock price movements [7][10]. - The Zacks Rank is distinct from ABR, as it is a quantitative model reflecting timely earnings estimates, while ABR may not always be up-to-date [8][11]. Earnings Estimate Trends - For Trip.com, the Zacks Consensus Estimate for the current year has declined by 8.4% over the past month to $3.44, indicating growing pessimism among analysts regarding the company's earnings prospects [12]. - This decline in earnings estimates has contributed to a Zacks Rank of 4 (Sell) for Trip.com, suggesting caution despite the positive ABR [13].

Core Viewpoint - The article discusses the reliability of brokerage recommendations, particularly focusing on Trip.com (TCOM), and highlights the disparity between brokerage ratings and actual stock performance [1][4]. Brokerage Recommendations - Trip.com has an average brokerage recommendation (ABR) of 1.11, indicating a consensus between Strong Buy and Buy, based on recommendations from 19 brokerage firms [2]. - Out of the 19 recommendations, 18 are classified as Strong Buy, representing 94.7% of all recommendations [2]. Limitations of Brokerage Recommendations - Solely relying on brokerage recommendations for investment decisions may not be advisable, as studies suggest they often fail to guide investors effectively towards stocks with high price appreciation potential [4]. - Brokerage analysts tend to exhibit a strong positive bias in their ratings due to vested interests, with five "Strong Buy" recommendations for every "Strong Sell" [5][9]. Zacks Rank Comparison - Zacks Rank, a proprietary stock rating tool, categorizes stocks from 1 (Strong Buy) to 5 (Strong Sell) and is based on earnings estimate revisions, making it a more reliable indicator of near-term stock performance [7][10]. - The Zacks Rank is updated more frequently than the ABR, reflecting timely changes in earnings estimates and business trends [11]. Current Earnings Estimates for Trip.com - The Zacks Consensus Estimate for Trip.com has declined by 6.5% over the past month to $3.74, indicating growing pessimism among analysts regarding the company's earnings prospects [12]. - This decline in earnings estimates has resulted in a Zacks Rank of 4 (Sell) for Trip.com, suggesting caution despite the positive ABR [13].

Investment Rating - The report assigns a "Hold" rating for the company with a target price of $65.00, representing a potential upside of 13.4% from the current price of $57.30 [4][5]. Core Insights - The company is expected to achieve significant revenue growth, with projected revenues of RMB 61.1 billion in 2025, reflecting a 14.5% increase from 2024 [3][5]. - Non-GAAP net profit is forecasted to reach RMB 19.0 billion in 2025, showing a modest growth of 5.4% compared to 2024 [3][5]. - The company is experiencing robust domestic travel demand while also seeing a strong recovery in international travel, with outbound travel expected to grow significantly due to increased flight availability and relaxed visa processes [5][6]. - The report highlights the potential for inbound tourism growth, particularly from countries with visa-free access to China, with a projected booking increase of over 100% year-on-year [5][6]. Financial Summary - For the fiscal year ending December 31, 2023, the company reported revenues of RMB 44.5 billion, a 122.2% increase year-on-year, and a non-GAAP net profit of RMB 9.5 billion, up 635.5% [3][6]. - The company’s gross margin is expected to stabilize around 81% in the coming years, with operating profit margins projected to remain around 24% [6][9]. - The balance sheet shows total assets of RMB 219.1 billion in 2023, with total liabilities of RMB 96.1 billion, indicating a healthy equity position [7][10]. Business Segments Performance - The company’s revenue from accommodation bookings, transportation ticketing, and vacation packages is expected to grow by 25.2%, 10.1%, and 38.1% respectively in 2024 [5][6]. - The international business segment, particularly Trip.com, is anticipated to contribute significantly to revenue, with a projected 70% year-on-year growth in Q4 2024 [5][6]. Market Outlook - The report emphasizes the strategic positioning of the company in emerging markets, aiming for market share growth despite potential short-term profit pressures due to international expansion [5][6]. - The company is expected to benefit from macroeconomic factors such as increased consumer spending in the tourism sector, supported by government initiatives like consumption vouchers [5][6].