Summit Research 'Aggressive' Buyers of Ctrip (CTRP); PT Lifted to $122

Summit Research analyst Henry Guo reiterated a Buy rating and boosted his price target on Ctrip.com (NASDAQ: CTRP) to $122.00 (from $80.00), saying they have become aggressive buyers of the stock.

Guo commented, "CTRP shares were up strongly last Friday after the company announced its acquisition of 37.6% equity stakes of eLong from Expedia. With CTRP shares trading at all-time high after the announcement, we continue to see upside potentials, as we believe: Firstly, CTRP's market position further strengthens after the acquisition, especially in the high-end hotel segment, which is a competitively and financially important segment for CTRP. Secondly, a potential rational pricing environment should significantly help Ctrip's profitability. Our analysis suggests if Ctrip withdraws most of its coupon offerings which were targeted at eLong, Ctrip's 2015 operating margin should improve 4~5 points and 2016 operating margin should improve 12~13 points. Thirdly, we believe near term Ctrip is likely further involved into industry consolidation M&As, which potentially serves as positive catalyst to CTRP shares. We reiterate our BUY rating on CTRP shares but raise PT from $80 to $122, to reflect the potential profitability improvement and more favorable industry competitive position."

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 $84.63 yesterday.

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