Market Overview

Here's What Disappointed Some Priceline Investors About Q3

Here's What Disappointed Some Priceline Investors About Q3

Priceline Group Inc (NASDAQ: PCLN) reported its third-quarter results Monday — which came in better than expected, but were accompanied with concerning fourth-quarter guidance. The company also said it will be increasing its marketing spending.

The Analyst

KeyBanc Capital Markets' Brad Erickson.

The Rating

Erickson maintains a Sector Weight rating on Priceline's stock with no assigned price target. (See Erickson's track record here.) 

The Thesis

Priceline's third quarter consisted of a gross booking, gross profit and room-night growth. Management guided Q4 room-night growth to just 8 to 13 percent, falling short of the 15 percent the Street was expecting. The company also guided its Q4 earnings per share below what the Street was expecting, which implies management is making higher brand investments while the overall demand for travel appears to be "softer."

But the bullish case for Priceline's stock can still be made, Erickson said. For example, incremental gross bookings per incremental ad dollar spent year-over-year rose for the first time in several quarters. Investors need additional clarity on the "true drivers of tactical marketing changes" before becoming constructive on the stock, the analyst said. 

Price Action

Priceline's stock was trading lower by more than 10 percent early Tuesday morning, but is also higher by 30 percent since the start of 2017.

Related Links:

Priceline, TripAdvisor Crushed Following Q3 Earnings

3 Stocks Moving On Expedia's Q3 Miss

Latest Ratings for PCLN

Feb 2018Deutsche BankMaintainsHoldHold
Jan 2018Wells FargoMaintainsMarket PerformMarket Perform
Dec 2017MKM PartnersDowngradesBuyNeutral

View More Analyst Ratings for PCLN
View the Latest Analyst Ratings


Related Articles (PCLN)

View Comments and Join the Discussion!

Posted-In: Brad Erickson KeyBanc Capital Markets Online Travel AgencyAnalyst Color Reiteration Travel Analyst Ratings General Best of Benzinga

Latest Ratings

MOHB of A SecuritiesUpgrades
SAGECanaccord GenuityMaintains80.0
View the Latest Analytics Ratings
Don't Miss Any Updates!
News Directly in Your Inbox
Subscribe to:
Benzinga Premarket Activity
Get pre-market outlook, mid-day update and after-market roundup emails in your inbox.
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Daily Analyst Rating
A summary of each day’s top rating changes from sell-side analysts on the street.
Fintech Focus
A daily collection of all things fintech, interesting developments and market updates.
Thank You

Thank you for subscribing! If you have any questions feel free to call us at 1-877-440-ZING or email us at