Trip.com (TCOM) Declines More Than Market: Some Information for Investors

In the latest close session, Trip.com (TCOM) was down 2.18% at $50.22. The stock fell short of the S&P 500, which registered a loss of 1.74% for the day. Meanwhile, the Dow lost 1.01%, and the Nasdaq, a tech-heavy index, lost 2.38%.

Prior to today's trading, shares of the travel services company had lost 4.32% lagged the Consumer Discretionary sector's loss of 3.73% and was narrower than the S&P 500's loss of 4.99%.

Market participants will be closely following the financial results of Trip.com in its upcoming release. On that day, Trip.com is projected to report earnings of $0.87 per share, which would represent year-over-year growth of 6.1%. Our most recent consensus estimate is calling for quarterly revenue of $2.33 billion, up 21.92% from the year-ago period.

TCOM's full-year Zacks Consensus Estimates are calling for earnings of $4.15 per share and revenue of $10.45 billion. These results would represent year-over-year changes of -36.35% and +19.27%, respectively.

Investors might also notice recent changes to analyst estimates for Tripcom. These revisions typically reflect the latest short-term business trends, which can change frequently. Therefore, positive revisions in estimates convey analysts' confidence in the business performance and profit potential.

Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 2.47% higher within the past month. Currently, Trip.com is carrying a Zacks Rank of #4 (Sell).

From a valuation perspective, Trip.com is currently exchanging hands at a Forward P/E ratio of 12.39. This denotes a discount relative to the industry average Forward P/E of 15.98.

Also, we should mention that TCOM has a PEG ratio of 3.1. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The average PEG ratio for the Leisure and Recreation Services industry stood at 1.3 at the close of the market yesterday.

The Leisure and Recreation Services industry is part of the Consumer Discretionary sector. Currently, this industry holds a Zacks Industry Rank of 148, positioning it in the bottom 40% of all 250+ industries.

The Zacks Industry Rank assesses the strength of our separate industry groups by calculating the average Zacks Rank of the individual stocks contained within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.

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This article originally published on Zacks Investment Research (zacks.com).

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