Deutsche Bank Lowers Target on priceline.com (PCLN) to $715, Worries Over Margin Compression

May 10, 2013 10:57 AM EDT Send to a Friend
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Price: $1,114.45 -1.63%

Rating Summary:
    27 Buy, 3 Hold, 0 Sell

Rating Trend: Down Down

Today's Overall Ratings:
    Up: 29 | Down: 28 | New: 24
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Deutsche Bank today maintained a Hold rating on priceline.com (NASDAQ: PCLN) and lowered its price target to $715.00 (from $745.00). Analyst Ross Sandler expressed concern about margin compression.

"Both PCLN and Expedia (Nasdaq: EXPE) continue to face de-leverage in their business models from: 1) inflationary pressure in customer acquisition, 2) mix shift to lower margin regions, and 3) mix shift to paid channels vs. organic," said Sandler.

Comments follow priceline.com's Q1 report yesterday. While EPS topped views, guidance was cautious.

"We continue to view PCLN’s valuation as compelling, but decelerating growth and margin compression in 2Q13 keep us on the sidelines for now," added the analyst.

For an analyst ratings summary and ratings history on priceline.com (NASDAQ: PCLN) click here. For more ratings news on priceline.com click here.

Shares of priceline.com closed at $737.50 yesterday.


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