Ctrip.com (CTRP) PT, Estimates Slashed at Piper Jaffray

Piper Jaffray analyst Michael Olson slashed estimates and his price target on Neutral-rated Ctrip.com (NASDAQ: CTRP) to $49.00 (from $55.00) following Q3 upside results but below-consensus revenue guidance.

Olson commented, "Ctrip reported Q3 upside, but guided revenue slightly below consensus with margins for Q4 expected to decrease 3,500bps y/y as the company experiences further competitive pressure. Specifically, for Q4, revenue guidance of 30% growth is 200bps below the Street and PF op margin guidance of -12% to -17% is materially below our previous estimate of +14%. Management reiterated expectations of 20%-30% PF op margins long-term, but visibility on multi-year margin trajectory is low due to increasing competition. Furthermore, beyond Q4, the company suggested that Q1 PF op margin may be flattish q/q and 2015 PF op margin may be similar to 2014 (low to mid single digits). While Ctrip has a leading position in a massive secular growth market, it is unclear when margin pressure will ease."

The firm cut FY14E EPS from US$0.58 to US$0.23 and FY15E EPS from US$1.16 to US$0.38.

For an analyst ratings summary and ratings history on Ctrip.com click here. For more ratings news on Ctrip.com click here.

Shares of Ctrip.com closed at $58.46 yesterday.

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