Analyst Saiyi He from CMB International Securities maintained a Buy rating on Tongcheng Travel Holdings Limited (0780 – Research Report) and keeping the price target at HK$24.00.
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Saiyi He has given his Buy rating due to a combination of factors that highlight Tongcheng Travel Holdings Limited’s strong financial performance and growth potential. The company’s first-quarter earnings exceeded expectations, with total revenue increasing by 13% year-over-year, driven primarily by the core online travel agency (OTA) business. This segment showed impressive operating leverage and efficiency improvements, contributing to a significant rise in adjusted net profit.
Despite a slower recovery in the Tourism business, the core OTA business demonstrated robust growth, particularly in transportation ticketing and accommodation reservation services. The operating margin for the core OTA segment expanded considerably, indicating sustained efficiency gains. Looking ahead, Saiyi He anticipates continued revenue growth and margin expansion, supported by strategic optimizations and favorable market conditions, justifying the Buy rating with a target price of HK$24.0.
In another report released on May 26, Jefferies also maintained a Buy rating on the stock with a HK$20.25 price target.
0780’s price has also changed moderately for the past six months – from HK$18.720 to HK$21.400, which is a 14.32% increase.
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