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Trip.com Investors Win Today, But What's in Store for the Long Run?

Now trading at a price of $37.51, Trip.com has moved 5.51% so far today. In contrast, the S&P 500 index moved -0.58%.

Trip.com shares moved 37.84% over the last 52 weeks, with a high of $40.17 and a low of $14.29. During this time, the stock outperformed the S&P 500 index by 47.33%. As of January 2022, the company's 50-day average price is $37.0. Trip.com Group Limited is a travel service provider for accommodation booking, transportation ticketing, destination and package tours, corporate travel management and other travel-related services in China and internationally. The large-cap Consumer Cyclical company is based in Shanghai, China.

Snapshot of the Company's Weak Margins, Declining Profitability, and High Leverage:

2018-12-31 2019-12-31 2020-12-31 2021-12-31
Revenue (MM) $30,965 $35,666 $18,316 $20,023
Revenue Growth n/a 15.18% -48.65% 9.32%
Gross Margins 79.58% 79.33% 77.99% 77.04%
Gross Margins Growth n/a -0.31% -1.69% -1.22%
Operating Margins 8.41% 14.13% -7.77% -7.05%
Operating Margins Growth n/a 68.01% -154.99% 9.27%
Earnings Per Share $1.96 $10.92 -$5.4 -$0.87
EPS Growth n/a 457.14% -149.45% 83.89%
Diluted Shares (MM) 567 642 601 634
Free Cash Flow (MM) $6,407 $6,499 -$4,355 $1,904
FCF Growth n/a 1.44% -167.01% 143.72%
Capital Expenditures (MM) $708 $834 $532 $571
Net Debt / EBITDA 8.79 2.54 99.22 11.68

Trip.com has negative earnings for the current period, so its trailing twelve month P/E ratio is not meaningful. But based on its EPS guidance of 1.05, the company has a forward P/E ratio of 35.72. In contrast, the Consumer Cyclical sector's average P/E ratio is 22.33.

On the other hand, Trip.com is possibly undervalued in terms of its net assets because its P/B ratio is 1.407 compared to its sector average of 3.12.

Trip.com Is the Subject of Mixed Market Indicators:

28 analysts are following Trip.com and have set target prices ranging from $33.69 to $52.51 per share. On average, they have given the company a rating of buy. At the current price of $37.51, TCOM is trading -10.63% away from its average analyst target price of $41.97 per share, implying an analyst consensus of some upside potential for the stock.

The above analysis is intended for educational purposes only and was performed on the basis of publicly available data. It is not to be construed as a recommendation to buy or sell any security. Any buy, sell, or other recommendations mentioned in the article are direct quotations of consensus recommendations from the analysts covering the stock, and do not represent the opinions of Market Inference or its writers. Past performance, accounting data, and inferences about market position and corporate valuation are not reliable indicators of future price movements. Market Inference does not provide financial advice. Investors should conduct their own review and analysis of any company of interest before making an investment decision.

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