Stock of the Day

October 20, 2021

Trip.com Group (TCOM)

$60.01
-$1.97 (-3.2%)
Market Cap: $39.22B

About Trip.com Group

Trip.com Group Limited, through its subsidiaries, operates as a travel service provider for accommodation reservation, transportation ticketing, packaged tours and in-destination, corporate travel management, and other travel-related services in China and internationally. The company acts as an agent for hotel-related transactions and selling air tickets, as well as provides train, long-distance bus, and ferry tickets; travel insurance products, such as flight delay, air accident, and baggage loss coverage; and air-ticket delivery, online check-in and seat selection, express security screening, real-time flight status tracker, and airport VIP lounge services. It also provides independent leisure travelers bundled packaged-tour products comprising group, semi-group, and customized and packaged tours with various transportation arrangements, including air, cruise, bus, and car rental services. In addition, the company offers integrated transportation and accommodation services; destination transportation and ticket, activity, insurance, visa, and tour guide services; user support, supplier management, and customer relationship management services; and in-destination products and services. Further, It provides its corporate clients with business visit, incentive trip, meeting and conference, travel data collection and analysis, and industry benchmarking solutions; and Corporate Travel Management System, an online platform that integrates information management, online booking and authorization, online inquiry, and travel reporting systems. Additionally, the company offers online advertising and financial services, such as marketing planning and travel media services. It operates under the Ctrip, Qunar, Trip.com, and Skyscanner brands. The company was formerly known as Ctrip.com International, Ltd. and changed its name to Trip.com Group Limited in October 2019. Trip.com Group Limited was founded in 1999 and is based in Singapore.

Trip.com Group Bull Case

Here are some ways that investors could benefit from investing in Trip.com Group Limited:

  • The current stock price is around $64, which is significantly lower than the 52-week high of $77.18, indicating potential for price appreciation.
  • Analysts have a strong consensus on the stock, with an average rating of "Buy" and a price target of approximately $77.25, suggesting confidence in future growth.
  • Trip.com Group Limited has a solid market capitalization of around $41.98 billion, reflecting its strong position in the travel service industry.
  • The company has a low debt-to-equity ratio of 0.14, indicating a strong balance sheet and lower financial risk, which is attractive for investors seeking stability.
  • Recent upgrades from analysts, including a "strong-buy" rating from Mizuho, highlight positive sentiment and potential for upward momentum in the stock price.

Trip.com Group Bear Case

Investors should be bearish about investing in Trip.com Group Limited for these reasons:

  • Despite positive ratings, the stock has experienced fluctuations, with recent trading volumes indicating some uncertainty among investors.
  • There has been a downgrade from Wall Street Zen, changing the rating from "buy" to "hold," which may signal caution for potential investors.
  • The company's price-to-earnings (P/E) ratio of around 19.23, while reasonable, may suggest that the stock is not undervalued compared to its peers.
  • Market volatility in the travel sector can impact performance, as seen in the fluctuating stock price and trading volumes, which may deter risk-averse investors.
  • Institutional ownership is at 35.41%, which, while significant, indicates that a large portion of the stock is held by a relatively small number of investors, potentially leading to volatility in stock price movements.
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