Priceline making a beeline for international markets – PCLN, EXPE & KYAK
Northern, WI 02/28/2013 (noesisstar) – By market value, Priceline.com Inc (NASDAQ:PCLN) is the largest online travel agency and it value rose the highest in a month after its revenues grew in the international markets thus pushing its fourth-quarter profits way past analyst estimates. Excluding items, its profits rose to $349 million by 26 percent and $6.77 per share whilst the average analyst estimates were $6.52 per share. Its revenue jumped up to $1.19 billion by 20 percent. Priceline.com Inc (NASDAQ:PCLN) is pitted against a considerably smaller rival Expedia Inc (NASDAQ:EXPE) in hotel reservation sales in Asia and Europe.
A growing market
These are the regions where consumers are getting more accustomed with online reservations and are using these sites more often. Expedia Inc (NASDAQ:EXPE)’s growth has been lagging behind Priceline.com Inc (NASDAQ:PCLN) for a long time now and it stated that its international sales last month accounted for close to 50 percent of its sales in the fourth-quarter which was a definite sign of growth opportunities in the international arena. Though there has been a lot of cross-border travel, movement from China to Europe has been on the rise and more people are traveling between these countries. Apart from this factor, Priceline had also been smart enough to invest in certain emerging markets before the rest of the companies.
Online reservations looking brighter
Analysts have been raising their Priceline estimates even as the company is investing in Asia and Latin America. Smartphone and internet usage has increased tremendously and people are getting more savvy with using online services and tools and Priceline.com Inc (NASDAQ:PCLN) wants to be sure that they do not miss the bus. Its international bookings touched $5.49 billion increasing by 40 percent in the fourth quarter and contributed to 83 percent of its overall bookings. The Amsterdam-based business, Booking.com is responsible for most of the Priceline revenue outside the U.S and it had been acquired in 2005. The 2007 acquired Agoda is another business via which Priceline.com Inc (NASDAQ:PCLN) serves Asia. Most companies are struggling with their businesses in Europe in the bleak current economic scenario.
In November, Priceline also bought Kayak Software Corp (NASDAQ:KYAK) for $1.8 billion and this deal which is the company’s biggest to date, gives it the comparison technology that customers can use to compare rates and make flight, hotel and car reservations. Priceline.com Inc (NASDAQ:PCLN) approval is pending with European regulators and the company hopes to gain a vote at next month’s Kayak Software Corp (NASDAQ:KYAK) shareholder meeting
Shares of Priceline.com Inc (NASDAQ:PCLN) went up by 2.57% to close at $695.91
Shares of Expedia Inc (NASDAQ:EXPE) went up by 2.16% to close at $64.18
Shares of Kayak Software Corp (NASDAQ:KYAK) went up by 0.60% to close at $40.02