Ctrip.com Price target Lowered at Brean Following Guidance Shortfall

In a note out this morning following earnings, Brean Capital analyst Fawne Jiang reiterated his Buy rating on shares of International Ltd

but lowered the price target from $74 to $64. Non-GAAP Earnings came in at 0.36, beating expectations of 0.32, but guidance was lowered from 35 percent to 30 percent for the fourth quarter, with margins expected to be flat. In the note, Mr. Jiang goes on to state: Reiterate Buy rating; Lower TP to $64 from $74. We remain a strong believer in CTRP's long-term story and reiterate our Buy rating on the stock. However, given continued intense competition and steppedup investments, we expect CTRP to face near-term margin pressures in the coming quarters. As such, we lower our TP to $64 reflecting our reduced 2015/2016 EPS estimates. Our price target implies 30x our 2016 EPS estimate of $2.13. Our 30x multiple reflects management's long-term growth guidance of ~30% through 2020. Downside risks to our valuation include: dampened macro outlook, increasing competition, negative impact from natural disasters and epidemics. Shares of CTRP are down nearly 14 percent in the pre-market at 51.70, after closing yesterday at 58.46.