Oppenheimer Cuts Price Target on Ctrip.com (CTRP) Following QUNR Acquisition

Oppenheimer maintained an Outperform rating on Ctrip.com (NASDAQ: CTRP), and cut the price target to $60.00 (from $65.00), following the company's acquisition of QUNR. Following an analysis of QUNR's minority interest shareswaps, and management discussions, Oppenheimer estimates that CTRP's diluted ADSs will be 576M after related transactions are complete.

Analyst Jed Kelly commented, "CTRP has declined 27% from its 52-week-high on share dilution concerns, following the acquisition of QUNR. Based on our analysis of QUNR's minority interest shareswaps, and management discussions, we estimate that CTRP's diluted ADSs will be 576M (+54% from 3Q) after related transactions are complete. While the dilutive impact is significant, we believe a consolidated entity is the correct strategy, positioning CTRP as the clear winner in China online travel. We estimate that CTRP will eventually control 80-90% of QUNR, and as a result, we are taking an initial stab at a pro-forma model. We are lowering our DCF based price target to $60 from $65 on higher ADSs assumptions. Our updated target implies 42% upside potential from current levels; Maintain Outperform."

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 $42.01 yesterday.

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