Ctrip.com International, Ltd. (CTRP): Looking For The Next Breakout?

Analysts at Credit Suisse cut their rating on shares of Ctrip.com International, Ltd. (NASDAQ:CTRP) from Outperform to Neutral in their opinion released on November 08. CLSA analysts have downgraded their rating of CTRP stock from Outperform to Underperform in a separate flash note to investors on November 08. Analysts at Citigroup downgraded the stock to a Neutral call from its previous Buy stance, in a research note that dated back to November 08.

How do you judge Wall Street’s opinion of CTRP stock? You could look at price, sure. But that doesn’t tell the whole story. Short sellers are betting against Ctrip.com International, Ltd. (NASDAQ:CTRP) during the most recent two-week period. Looking at the sentiment indicator for the CTRP stock we see that the short-interest ratio is at 2.198944 while the average analyst recommendations at 2.6 suggests buying these shares. Between October 31 and November 15, the total number of shorted shares amounted to 20.03 million shares. That was 5.6% more than the total of 18.97 million shares in the space of prior two weeks, which means more traders or funds betting that the stock will go down. Average daily volume for Ctrip.com International, Ltd. at the November 15th settlement jumped to 9,109,980, as compared to 5,402,620 at the October 31st report. That brought days to cover 37.37% down from the 3.51111 days to cover recorded at the prior short interest data release.

By watching the trading activity of corporate insiders, it will become easier to get a sense of Ctrip.com International, Ltd. (NASDAQ:CTRP)’s prospects.

Ctrip.com International, Ltd. (CTRP) is expected to jump by 21.57 percent over the next 12 months, according to price target estimates compiled by finviz. Meanwhile, they have set a $50.37-month high price target. This represents a whopping 73.81 percent increase from where shares are trading today. The 12-month median price target assigned by the analysts stands at $35, which represents a return potential of 20.77 percent when compared to the closing price of the stock of $28.98 on Thursday, December 06. The lowest price target for the stock is $24 — slightly more than -17.18 percent from CTRP’s current share price.

The shares are currently floating around the first support level of $28.32. Below this, the next support is placed in the zone of $27.67. Till the time, the CTRP stock trades above this level, bulls have nothing to fear. On momentum oscillators front, ‘RSI’ has touched 48.65 on daily chart, which may remain a cause for concern. If the price breaks below $27.67 level on closing basis, then we may see more profit booking and the stock may show further weakness. On the flipside, hitting the $29.53 mark may result into a pull-back move towards $30.09 level.

CTRP shares dropped -0.65 points or -2.19 percent on Thursday to $28.98 with a light trade volume of 5.235 million shares. After opening the session at $28.75, the shares went as high as $29.43 and as low as $28.22, the range within which the stock’s price traded throughout the day. The firm is left with a market cap of $15.4 billion and now has 529.91 million shares outstanding. Ctrip.com International, Ltd. (CTRP) stock has lost -14.99 percent of market value in 21 trading days.

CTRP stock has a trailing 3-year beta of 1.89, offering the possibility of a higher rate of return, but also posing more risk. The portion of a company’s profit allocated to each outstanding share of common stock was $0.57 a share in the trailing twelve months. The stock’s value has fallen -34.29 percent year to date (YTD) against a decline of -36.93 percent in 12 month’s time. The company’s shares still trade -44.17 percent away from its 1-year high of $51.91 and 15.92 percent up from 52-week low of $25.00. The average consensus rating on the company is 2.6, on a scale where 5 equates to a unanimous sell rating. In short, the mean analyst recommendations are calling this stock a sell.

Shares of Ctrip.com International, Ltd. (CTRP) are trading at a P/E ratio of 49.55 times earnings reported for the past 12 months. The industry CTRP operates in has an average P/E of 43.67. Its P/E ratio went as low as 42.33X and as high as 177.74 over the 5-year span. Further, it is sporting a 3.6 on the Price-to-Sales ratio. Compare this with the industry average P/S of 7.87. 80.5 percent is the gross profit margin for Ctrip.com International, Ltd. and operating margin sits at 10.5 percent. Along with this, the net profit margin is 9 percent.

CTRP will be showing off its Q4 earnings on March 13. Analysts are forecasting revenue to climb 12.8 percent to $1.04B in the next fiscal quarter, while earnings are seen soaring by nearly -122.22 percent to -$0.04 per share. History has shown that shares in Ctrip.com International, Ltd. have gone up on 19 different earnings reaction days and are predicted to add 0.07 percent when the company reports upcoming earnings. In last reported earnings results, it earned $0.42 per share, better than the $0.27, adjusted, expected by Thomson Reuters consensus estimate. Revenue was $9.36B, better than the $9.26B analysts expected. Earnings are estimated to increase by 211.4 percent this year, 5.89 percent next year and continue to increase by 2.08 percent annually for the next 5 years.