Priceline takes a Flight to Value

Priceline.com is a pureplay internet travel website and a pioneer in its field. Priceline was one of the first internet sites to offer discounted airfares, hotels and car rentals and the first and only site that allows you to bid for airfare, hotels and car rentals for your travel (unless you consider Luxury Link which caters to the high-end vacation market).

The Priceline (PCLN) stock has been bid lower over the last few weeks with the rest of the market, yet fundamentals never looked better. The 27% drop in their value is surprising given the strength of their earnings. The quarter ending March saw revenues increase 34% to $403.2 million and profits up 77% to $0.76 a share. Gross travel bookings increased 76% taking market share from rivals Orbitz (OWW) and Expedia (EXPE), including an increase in domestic bookings by 51%. The earnings beat estimates handily makin...