Jefferies remarked in a report that Trip.com Group (TCOM.US) beat market expectations on both revenue and non-GAAP earnings in 1Q24. Company management outlined steady growth in both local and outbound business volumes and raised its full-year margin forecast in light of improved cost efficiency. According to the company, new drivers included the potential to increase penetration in lower-end cities, and room for growth in local, outbound and overseas business.
The broker maintained its 2Q24 forecasts, estimating Trip.com's total revenue to grow by 13% YoY to RMB12.7 billion, gross margin to be around 82% and non-GAAP operating profit to be around RMB4 billion. Full-year non-GAAP operating profit is expected to be about RMB15.7 billion, higher than the previous estimate of RMB14.4 billion. Full-year non-GAAP operating margin is estimated to be 30%, up from the previous estimate of 27.5%.
Jefferies maintained its Buy rating and lifted its target price from US$60 to US$70.
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