The Priceline Group Inc. ($PCLN) is the well-known leader in online travel services owning "six primary brands: Booking.com, priceline.com, agoda.com, KAYAK , rentalcars.com and OpenTable. " Not only do the operate in over 220 countries and territories, but they also operate in over 42 languages, a key skill in the globalized economy. Now let us examine the financial data driving this travel service group and determine whether they are primed for an investment.
According to Priceline's Investor Relations webpage they handled $55.5 billion in gross bookings in 2015. A few data points that I like about PCLN are as follows...
P/E Ratio: 25.60
This ratio is higher than the average for the S&P 500, but PCLN has been growing rapidly and has outpaced their competition in numerous categories.
Profitability
PCLN tops the industry average in gross profit margins (90.2% vs 77.1%), operating margin (35.3% vs. 20.2%) and profit margin (27.7% vs. 19.4%)
Financial Strength
PCLN has less debt/equity than the industry average and is a better value in terms of Price/Cash flow.
Revenue
PCLN's revenue per share is 179x vs the 20.7x industry average.
Summary
This company is truly the best of breed when it comes online travel booking. They bring in a tremendous amount of revenue without taking on insurmountable debt. This company also knows how to capitalize on this revenue and turn it into profit. I would certainly look into investing in a piece of this company as the U.S. economy continues to improve and consumers will travel more frequently.
bookmarked!!, I love your site!
ReplyDeleteHey there! I know this is somewhat off topic but I was wondering if you knew where I could get a captcha plugin for my comment form? I'm using the same blog platform as yours and I'm having difficulty finding one? Thanks a lot!
ReplyDelete