PCLN(NASDAQ

)

Background
 priceline.com Incorporated is an online travel company that offers its customers hotel room reservations at over 210,000 hotels worldwide through the Booking.com, priceline.com and Agoda brands.  In the United States, the Company also offers its customers reservations for car rentals, airline tickets, vacation packages, destination services and cruises through the priceline.com brand.

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Background

 In the United States, the Company also offers customers the ability to purchase other travel services, including airline tickets, rental car days, vacations packages, destination services and cruises through both a traditional, price-disclosed retail manner, and through its demand-collection system known as Name Your Own Price.

Fundamentals'
During the year ended December 31, 2011, it re-branded Travel Jigsaw as rentalcars.com through rentalcars.com, it offers retail price-disclosed rental car reservations worldwide.  It offers car rental reservations worldwide through rentalcars.com.

Fundamentals'
 Priceline uses a unique business model known as the reverse auction pricing model.  Not only has Priceline pioneered this business model, but it has also patented it.  Priceline is that it has been aggressively expanding its international presence.  International bookings currently account for 78% of its total business.

Fundamentals'
 Priceline has been destroying its competition in terms of generating revenue. Priceline has increased its revenues by more than 209% from 2008 to February of 2012.  It has a 3-Year Sales Growth rate of 35%

Fundamentals'
 Priceline.com has an excellent combination of strong free cash flow generation and low financial leverage. We expect the firm's free cash flow margin to average about 29.9% in coming years.  Total debt-to-EBITDA was 0.4 last year, while debt-to-book capitalization stood at 18.3%.

EARNINGS ESTIMATES
 

This Quarter 06/2012 7.07 11

Next Quarter 09/2012 12.48 11

This Year 12/2012 30.06 11

Next Year 12/2013 37.21 11

Average Estimate Number of Estimates

Low Estimates High Estimate Year Ago EPS EPS Growth

6.93 7.25 5.27 34.21%

11.41 13.07 9.75 28.04%

28.80 30.88 22.32 34.66%

34.74 39.31 30.06 23.79%

Financial Summary

Industry Analysis
Expedia Market Cap Revenue Gross Margin EBITDA Operating Margin Net Income P/E 7.38 B 2.88 B 79.28% Orbitz 501.64 M 743 M 81.70% Priceline 9.27 B 2.20 B 52.33% 445.13 M 18.41% Travelocity N/A N/A N/A N/A N/A N/A N/A 22.41 Industry 497.45 M 929.06 M 46.97% 158.63 M 17.80%

735.35 M 149 M 22.24% -2.56 B N/A 10.90% -311 M N/A

456.39 M
22.30

Capital Structure

Future Path of Fair Value

Future Path of Fair Value

Future Path of Fair Value

Analyst Estimates

Zakcs Research ………………… Price Target ( $ 810) JPMorgan Chase………………….Price Target ( $ 707) Piper Jaffray ………………………. Price Target ( $ 881) Piper Jaffray ………………………. Price Target ( $ 881) Mean@ yahoo Finance…….….Price Target ($ 803) Nasdaq…………………………………Price Target ($ 800) Consensus At Ft.com…………..Price Target ($ 800)

Stock Performance

Stock Performance

Technical's
Current Market price …..645 50-Day moving avg………566 100-Day moving avg……490 1st Support@ 628(23.60% Retracement) 2nd Support@538(28.30% Retracement) 1st Resistance@650 2nd Resistance@700

Conclusions
Stock in its correction phase Fundamentals are awesome. Sales growth more than 30% Strong free cash flow

Recommendations
Based on a strong fundamentals , we expect the company has the ability to outperform the market. Buy@590-600 Buy on dips We recommend that the company be kept on the watch list.

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