Trip.com Group Sponsored ADR (TCOM) AI Stock Analysis

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Trip.com Group Sponsored ADR

(NASDAQ:TCOM)

Rating:74Outperform

Price Target:

$68.00

▲( 11.37% Upside)

Trip.com Group Ltd.'s stock score is driven by strong financial performance, highlighted by significant revenue growth and profitability, despite recent cash flow challenges. The company's positive earnings call performance, coupled with effective strategic initiatives and AI-driven improvements, further supports the stock's prospects. Technical analysis suggests a neutral outlook, while valuation metrics indicate fair pricing. The absence of significant corporate events ensures the focus remains on core financial and operational strengths.

Positive Factors

AI Integration

AI integration is expected to further enhance user engagement and operational efficiency, improving both experience and scalability.

Financial Stability

The company has announced an annual dividend plan, indicating financial stability.

Overseas Expansion

TCOM's overseas expansion is on the right track, which should bring long-term value to TCOM.

Negative Factors

Ad Spending

Ad spending has been increasing significantly, with a planned percentage of revenue rising from lows of about 20% to 23-24% in the upcoming period.

Business Travel Demand

Demand for business travel was slightly softer and volatile, causing pressure on hotel and air ticket prices.

Margin Pressure

Expansion of Trip.com is weighing on margins, with a year-over-year decrease of approximately 150 basis points.

Trip.com Group Sponsored ADR (TCOM) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$42.59B

Dividend Yield0.45%

Average Volume (3M)4.06M

Price to Earnings (P/E)18.5

Beta (1Y)0.72

Revenue Growth16.23%

EPS Growth56.05%

CountryUS

Employees41,073

SectorConsumer Cyclical

Sector Strength72

IndustryTravel Services

Share Statistics

EPS (TTM)0.83

Shares Outstanding689,450,260

10 Day Avg. Volume3,127,122

30 Day Avg. Volume4,060,026

Financial Highlights & Ratios

PEG Ratio3.97

Price to Book (P/B)2.18

Price to Sales (P/S)0.00

P/FCF Ratio-3.39K

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$75.46

Price Target Upside23.58% Upside

Rating ConsensusStrong Buy

Number of Analyst Covering13

Trip.com Group Sponsored ADR Business Overview & Revenue Model

Company DescriptionTrip.com Group Limited, through its subsidiaries, operates as a travel service provider for accommodation reservation, transportation ticketing, packaged tours and in-destination, corporate travel management, and other travel-related services in China and internationally. The company acts as an agent for hotel-related transactions and selling air tickets, as well as provides train, long-distance bus, and ferry tickets; travel insurance products, such as flight delay, air accident, and baggage loss coverage; and air-ticket delivery, online check-in and seat selection, express security screening, real-time flight status tracker, and airport VIP lounge services. It also provides independent leisure travelers bundled packaged-tour products comprising group, semi-group, and customized and packaged tours with various transportation arrangements, including air, cruise, bus, and car rental services. In addition, the company offers integrated transportation and accommodation services; destination transportation and ticket, activity, insurance, visa, and tour guide services; user support, supplier management, and customer relationship management services; and in-destination products and services. Further, It provides its corporate clients with business visit, incentive trip, meeting and conference, travel data collection and analysis, and industry benchmarking solutions; and Corporate Travel Management System, an online platform that integrates information management, online booking and authorization, online inquiry, and travel reporting systems. Additionally, the company offers online advertising and financial services, such as marketing planning and travel media services. It operates under the Ctrip, Qunar, Trip.com, and Skyscanner brands. The company was formerly known as Ctrip.com International, Ltd. and changed its name to Trip.com Group Limited in October 2019. Trip.com Group Limited was founded in 1999 and is based in Singapore.

How the Company Makes MoneyTrip.com Group Ltd. generates revenue primarily through commissions and service fees collected from various travel service providers for bookings made via its platform. The company's key revenue streams include hotel reservation services, where it earns commissions on each booking, and transportation ticketing, which includes air and train ticket sales with associated service fees. Additionally, Trip.com Group offers packaged tours and corporate travel management services, contributing further to its revenue. The company leverages technology and data analytics to enhance user experience and optimize its offerings. Significant partnerships with airlines, hotels, and local travel service providers also play a crucial role in expanding its service portfolio and enhancing its revenue generation capabilities.

Trip.com Group Sponsored ADR Financial Statement Overview

Summary

Trip.com Group Ltd. shows strong financial performance with significant revenue and profit growth, efficient cost management, and a stable balance sheet. However, the recent decline in cash flow metrics highlights potential challenges in cash management or reinvestment strategies. Despite this, the company's solid profitability and stable leverage ratios position it well for future growth.

Income Statement

Very Positive

Trip.com Group Ltd. shows strong financial performance with consistent revenue growth, seeing a notable increase in Total Revenue from 20,039 million in 2022 to 53,294 million in 2024. The Gross Profit Margin improved from 77.5% in 2023 to 81.2% in 2024, indicating efficient cost management. Net Profit Margin stood at a healthy 32% in 2024, demonstrating robust profitability. The EBIT Margin increased to 26.6% in 2024, reflecting improved operational efficiency.

Balance Sheet

Positive

The balance sheet of Trip.com Group Ltd. is stable with a healthy Debt-to-Equity Ratio of 0.28 as of 2024, showing conservative leverage. The Return on Equity (ROE) is impressive at 11.97% in 2024, indicating efficient use of equity to generate profits. The company maintains a strong Equity Ratio of 58.8%, providing a solid financial foundation. There is a significant increase in Stockholders' Equity from 112,283 million in 2022 to 142,550 million in 2024, reflecting retained earnings and growth.

Cash Flow

Neutral

While the operating cash flow was notably strong at 22,004 million in 2023, it dropped to zero in 2024, suggesting potential cash management issues or significant reinvestment. The Free Cash Flow in 2023 was substantial at 21,398 million but also fell to zero in 2024. The lack of Free Cash Flow growth raises concerns about cash generation sustainability, offsetting previous strong cash flow performance.

Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
53.29B	44.51B	20.04B	20.02B	18.32B
	Gross Profit
43.30B	36.39B	15.53B	15.43B	14.29B
	EBIT
14.18B	11.32B	2.86B	-319.00M	-1.07B
	EBITDA
14.99B	12.14B	88.00M	1.09B	491.00M
	Net Income Common Stockholders
17.07B	9.92B	1.95B	-741.00M	-1.58B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
79.57B	59.34B	44.03B	50.76B	44.23B
	Total Assets
242.58B	219.14B	191.69B	191.86B	187.25B
	Total Debt
40.32B	45.57B	46.38B	51.36B	57.00B
	Net Debt
-10.96B	3.98B	27.90B	30.16B	37.59B
	Total Liabilities
99.10B	96.13B	78.67B	81.40B	85.68B
	Stockholders Equity
142.55B	122.18B	112.28B	109.68B	100.35B
Cash Flow		Free Cash Flow
19.03B	21.40B	2.14B	1.90B	-4.36B
	Operating Cash Flow
19.63B	22.00B	2.64B	2.48B	-3.82B
	Investing Cash Flow
-6.05B	5.92B	1.14B	-4.15B	-3.82B
	Financing Cash Flow
-6.71B	-2.55B	-6.72B	3.92B	6.03B

Trip.com Group Sponsored ADR Technical Analysis

Technical Analysis Sentiment

Negative

Last Price61.06

Price Trends

50DMA

60.83

Positive

100DMA

63.29

Negative

200DMA

60.68

Positive

Market Momentum

MACD

1.17

Positive

RSI

47.22

Neutral

STOCH

21.29

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TCOM, the sentiment is Negative. The current price of 61.06 is below the 20-day moving average (MA) of 62.18, above the 50-day MA of 60.83, and above the 200-day MA of 60.68, indicating a neutral trend. The MACD of 1.17 indicates Positive momentum. The RSI at 47.22 is Neutral, neither overbought nor oversold. The STOCH value of 21.29 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TCOM.

Trip.com Group Sponsored ADR Risk Analysis

Trip.com Group Sponsored ADR disclosed 78 risk factors in its most recent earnings report. Trip.com Group Sponsored ADR reported the most risks in the “Finance & Corporate” category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 1 New Risks

We have limited business insurance coverage. Q4, 2023

Trip.com Group Sponsored ADR Peers Comparison

Overall Rating

UnderperformOutperform

Sector (62)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
BKNG	77 Outperform	$172.81B	33.04	-146.32%	0.68%	9.47%	20.70%
ABNB	77 Outperform	$82.77B	32.09	32.06%	―	9.68%	-47.83%
MMYT	75 Outperform	$11.39B	119.24	8.33%	―	28.51%	367.34%
EXPE	74 Outperform	$20.66B	19.15	119.16%	0.25%	5.57%	61.19%
TCOM	74 Outperform	$42.59B	18.53	12.49%	0.45%	16.23%	56.05%
TRIP	71 Outperform	$1.82B	38.04	5.91%	―	1.43%	121.44%
Sector *	62 Neutral	$6.88B	11.26	2.78%	3.93%	2.65%	-22.00%

* Consumer Cyclical Sector Average

Performance Comparison

TCOM

Trip.com Group Sponsored ADR

61.06

8.55

16.28%

EXPE

Expedia

160.72

50.64

46.00%

MMYT

Makemytrip

100.73

21.49

27.12%

BKNG

Booking Holdings

5,341.91

1,578.00

41.92%

TRIP

TripAdvisor

13.87

-4.02

-22.47%

ABNB

Airbnb

127.65

-16.82

-11.64%

Trip.com Group Sponsored ADR Earnings Call Summary

Earnings Call Date:May 19, 2025

(Q1-2025)

% Change Since: -9.00%|

Next Earnings Date:Sep 18, 2025

Earnings Call Sentiment Positive

The earnings call indicates a strong overall performance for Trip.com Group in the first quarter of 2025, with significant growth in inbound travel and international operations, as well as effective use of AI technology to enhance user engagement. Despite challenges in corporate travel revenue and fluctuating marketing expenses, the company's strategic initiatives and operational efficiencies have led to robust financial results and a commitment to returning value to shareholders.

Q1-2025 Updates

Positive Updates

Strong Growth in Inbound Travel

Inbound travel bookings surged by approximately 100% year-over-year, with key source markets being South Korea, Thailand, Malaysia, and Indonesia. This growth is supported by the strategic push from China to attract international visitors.

AI-Driven User Engagement

The AI agent, TripGenie, saw around a 50% increase in average user session duration. AI chatbots and self-service tools handled over 80% of inquiries, improving response times and boosting customer satisfaction.

Revenue and EBITDA Growth

Net revenue increased by 16% year-over-year to RMB13.8 billion, and adjusted EBITDA grew by 7% year-over-year, demonstrating continued operational efficiency improvement.

Strong International OTA Platform Performance

Overall travel bookings on the international OTA platform grew by over 60% year-over-year, with APAC remaining a major growth engine.

Robust Mobile Platform Contributions

The mobile platform now contributes 70% of international bookings, reflecting the growing user preference for app-based travel planning.

Resilient Domestic Travel Demand

Domestic hotel bookings in China continued to see double-digit growth year-over-year, underscoring a strong appetite for local exploration.

Expansion in Inbound Market Offerings

Trip.com Group has launched free city tours for transit travelers in Shanghai and Beijing, and is upgrading offline stores into multilingual service centers.

Successful Capital Return Program

The company repurchased approximately $84 million of its shares, demonstrating a commitment to delivering value to shareholders.

Negative Updates

Challenges in Corporate Travel Revenue

Corporate travel revenue for the first quarter was RMB573 million, representing a 12% increase year-over-year but an 18% decrease quarter-over-quarter, attributed to normal seasonality.

Muted Hotel ADR Performance

Hotel ADR in general decreased by high single digits in the first quarter compared with last year, due to price stabilization challenges.

Sales and Marketing Expense Fluctuations

Adjusted sales and marketing expenses increased by 30% from the same period last year, mainly driven by heightened marketing efforts aligned with business expansion.

Company Guidance

During the Trip.com Group's first quarter 2025 earnings call, management provided a detailed guidance on their financial performance and strategic initiatives. The company reported a net revenue of RMB13.8 billion, a 16% year-over-year increase, with adjusted EBITDA growing by 7% year-over-year to RMB4.2 billion. Trip.com experienced significant growth in inbound travel bookings, which surged by approximately 100% year-over-year, particularly from markets like South Korea, Thailand, Malaysia, and Indonesia. Their international OTA platform bookings increased by over 60%, driven largely by mobile platform usage, which contributes 70% of international bookings. In terms of operational efficiency, the company maintained a strong focus on AI-driven enhancements, with AI tools now handling over 80% of customer inquiries. Looking ahead, the company remains optimistic about capturing further growth opportunities, supported by strong consumer confidence and favorable travel policies, including a 240-hour visa-free transit policy in China. Additionally, they are committed to shareholder value, having repurchased approximately $84 million worth of shares and distributed $200 million in cash dividends.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.