Jaffray maintain Ctrip Neutral rating target price 33 USD

Sina Science and technology news Beijing time of July 26, Jaffray, US investment bank PiperJaffray today issued an investment report to maintain Ctrip (NASDAQ:CTRP) "neutral" rating, the target price of 33 U.S. dollars.

The following is a summary of the contents of the report:

We believe that Ctrip will achieve the highest net revenue target in the second quarter of fiscal year 2013 after China's June air traffic data release. Ctrip's Better-than-expected revenue and operating margins led to a rise in share prices, which led to higher performance than expected. We believe that the combined Ctrip's first-quarter bright-eye performance and the second-quarter stable travel data will meet or exceed the net revenue growth forecast of 15% to 20% in the second quarter.

Air traffic in the second quarter (end of June): passenger numbers increased 7% year-on-year, slightly below 8% in the first quarter. Based on our analysis of Ctrip's air tickets and hotel data, the company is expected to exceed its net revenue increase of 15% to 20% in the second quarter.

Second quarter (end of June) Hotel Reservations: Market Research Institute Smith TRAVEL Study data show that the second quarter hotel bookings fell 7%, the first quarter year-on-year decline of 4%. Ctrip's 15%-to-20% hotel bookings in the second quarter are expected to coincide with Smith's Travel.

Online Tourism Market Competition: 2012 China Online Tourism (OTA) Market competition is very fierce, but entered the second half of 2013, the competition tends to be stable. Ctrip launched a new cash rebate promotional activities to deal with the low end of the tourism consumer market fierce competition. However, Ctrip's operating profit margin in the first quarter of this year was higher than in the previous quarter, the first quarter-on-quarter growth since the second quarter of 2009. We anticipate that Ctrip's profitability will continue to grow, driven by revenue growth and operational leverage.

Risk: Competition continues, China's economic slowdown and the withdrawal of key partners.

Valuation: As the tourism business development stability, operating profit chain growth, we maintain a "neutral" rating of Ctrip, the target price of 33 U.S. dollars. (Chen)