The Priceline Group (PCLN) PT Raised to $2,100 at Stifel; Reiterates Buy
Stifel raised its price target on The Priceline Group (NASDAQ: PCLN) to $2,100.00 (from $1,900.00) while maintaining a Buy rating. Total bookings growth of 28% y/y FX-adj. to $15.1B was well above the 17%-22% guided range. Priceline guided 1Q:17 room nights and total bookings ahead of estimates.
Analyst Scott Devitt commented, "Priceline reported strong 4Q:16 results highlighted by 31% y/y room night growth, 28% y/y FX-adj. bookings growth, and adj. EBITDA margins of 38.2% (gross profit), all exceeding our and consensus expectations. Momentum continued into 1Q:17 as Priceline guided next quarter room nights (20%-25%) and FX-adj. bookings (19%-24%) ahead of our expectations. Pressure on performance marketing ROI is expected to continue into 1Q, though to a lesser degree than the recent past, and the book vs. day time lag and the Easter shift will pressure margins in the quarter. Management noted that performance ad efficiency in 1H:17 will be more favorable than 2H:16. New CEO Glenn Fogel commented that the corporate strategy will not change under his leadership. We are raising our estimates and increasing our price target to $2,100. Overall, we maintain the view Priceline is a high quality asset well positioned to drive continued long-term growth."