TCOM - Trip.com: Navigating Global Expansion Amid Domestic Headwinds
2025-02-27 09:47:38 ET
Summary
- Trip.com reported strong Q4 results, with revenue growth of 23% y/y, but margins fell short due to international market investments.
- US shares dipped, but Hong Kong shares rose; recommend buying on the dip due to promising international expansion and reasonable margin traction.
- Valued at 15x forward EBITDA, implying $79/share and a 37% upside; investment in Trip.com app crucial for diversifying revenue streams.
- Risks include reliance on China's domestic tourism and potential increased spending on global expansion, possibly leading to multiple contraction.
Trip.com ( TCOM ) reported 4Q24 results ahead of consensus, driven by strong growth across all business segments. However, margins fell short of the estimate due to the ongoing investment in the international market, and management guided a fairly optimistic outlook on domestic and outbound tourism that the street viewed as conservative....
Trip.com: Navigating Global Expansion Amid Domestic Headwinds