Core Viewpoint - Trip.com (TCOM) has been upgraded to a Zacks Rank 1 (Strong Buy), indicating a positive outlook on its earnings estimates, which is a significant factor influencing stock prices [1][2]. Earnings Outlook - The Zacks Consensus Estimate for Trip.com projects earnings of $3.08 per share for the fiscal year ending December 2024, reflecting a year-over-year increase of 12.4% [5]. - Over the past three months, the consensus estimate for Trip.com has risen by 4.9%, indicating a trend of increasing earnings estimates [5]. Impact of Earnings Estimates on Stock Prices - Changes in earnings estimates are strongly correlated with near-term stock price movements, largely due to institutional investors who adjust their valuations based on these estimates [3]. - The upgrade in Trip.com's rating suggests an improvement in its underlying business, which is expected to drive the stock price higher as investors respond to this trend [3][7]. Zacks Rating System - The Zacks Rank system classifies stocks into five groups based on earnings estimates, with Zacks Rank 1 stocks historically generating an average annual return of +25% since 1988 [4]. - The upgrade of Trip.com to Zacks Rank 1 places it in the top 5% of Zacks-covered stocks, indicating strong potential for price appreciation in the near term [6][7].

Core Viewpoint - Trip.com Group Limited has successfully completed a US$1.5 billion offering of convertible senior notes due 2029, which will be used for debt repayment, overseas business expansion, and working capital needs [1][2]. Group 1: Notes Offering Details - The offering includes an additional US$200 million due to the full exercise of the initial purchasers' option [1] - The notes will bear an interest rate of 0.75% per year, payable semiannually starting December 15, 2024, and will mature on June 15, 2029 [2] - The initial conversion rate is set at 15.0462 American depositary shares (ADSs) per US$1,000 principal amount, translating to an initial conversion price of approximately US$66.46 per ADS [2] Group 2: Regulatory and Legal Information - The notes and the ADSs deliverable upon conversion have not been registered under the Securities Act and may only be offered to qualified institutional buyers [3] - This press release does not constitute an offer to sell or a solicitation of an offer to purchase any of these securities [3] Group 3: Company Overview - Trip.com Group Limited is a leading global one-stop travel platform, providing a comprehensive suite of travel products and services [5] - The company operates under various brands, including Ctrip, Qunar, Trip.com, and Skyscanner, and aims to enhance the travel experience for users [6]

Core Viewpoint - Investors are increasingly seeking growth stocks, particularly in the financial sector, to achieve above-average returns, with Trip.com (TCOM) identified as a promising growth stock due to its favorable metrics and Zacks Rank [1][6]. Earnings Growth - Trip.com has a historical EPS growth rate of 12.8%, with projected EPS growth of 12.4% for the current year, surpassing the industry average of 12.2% [3]. Cash Flow Growth - The company exhibits a remarkable year-over-year cash flow growth of 374.8%, significantly higher than the industry average of -12.3%. Over the past 3-5 years, Trip.com has maintained an annualized cash flow growth rate of 20.9%, compared to the industry average of -2.5% [4]. Earnings Estimate Revisions - There has been a positive trend in earnings estimate revisions for Trip.com, with the Zacks Consensus Estimate for the current year increasing by 5.1% over the past month [5]. Overall Positioning - Trip.com has achieved a Growth Score of B and a Zacks Rank of 2, indicating strong potential for outperformance in the growth stock category, making it an attractive option for growth investors [6][7].

Group 1 - Trip.com currently has an average brokerage recommendation (ABR) of 1.14, indicating a consensus between Strong Buy and Buy, with 88.9% of recommendations being Strong Buy and 5.6% being Buy [1][6] - The Zacks Consensus Estimate for Trip.com has increased by 5.1% over the past month to $3.08, reflecting analysts' growing optimism regarding the company's earnings prospects [6] - The Zacks Rank for Trip.com is 2 (Buy), suggesting a positive outlook based on earnings estimate revisions [6] Group 2 - Brokerage recommendations often exhibit a strong positive bias, with a ratio of five "Strong Buy" recommendations for every "Strong Sell," indicating potential misalignment with retail investors' interests [2][4] - The Zacks Rank is a quantitative model based on earnings estimate revisions, which has shown a strong correlation with near-term stock price movements, making it a more reliable indicator than ABR [5] - The ABR may not always be up-to-date, while the Zacks Rank reflects timely changes in earnings estimates, providing a more accurate indication of future price movements [5]

SINGAPORE, June 4, 2024 /PRNewswire/ -- Trip.com Group Limited (Nasdaq: TCOM; HKEX: 9961) ("Trip.com Group" or the "Company"), a leading one-stop travel service provider of accommodation reservation, transportation ticketing, packaged tours, and corporate travel management, today announced the pricing of its previously announced offering (the "Notes Offering") of US$1.3 billion in aggregate principal amount of convertible senior notes due 2029 (the "Notes"). The Notes have been offered to persons reasonably ...

Group 1: Travel Industry Overview - The phenomenon of revenge travel has faded, but there remains a bullish case for travel stocks due to the strong U.S. dollar, which enhances American tourists' purchasing power [1] - The Covid-19 pandemic has led to a behavioral shift where consumers prioritize experiential expenditures, supporting the case for travel stocks [1] Group 2: Wyndham Hotels & Resorts (WH) - Wyndham Hotels & Resorts operates as a hotel franchisor with brands like Super 8 and Days Inn, and reported sales of $1.4 billion in 2023, down nearly 7% from $1.5 billion in 2022 [2] - In the trailing 12 months, Wyndham posted a net income of $238 million, translating to earnings per share (EPS) of $2.84 [2] - For the current fiscal year, sales are projected to reach $1.49 billion, an increase of nearly 7%, with EPS expected to rise to $4.36, indicating a growth of just under 28% [3] Group 3: United Airlines (UAL) - United Airlines provides air transportation services and is recovering from the impacts of Covid-19, with 2023 revenue projected at $53.72 billion [4][5] - In 2020, United's sales were $15.36 billion, down 64.5% from $43.26 billion in 2019, but analysts expect revenue to increase by 8.46% to $58.26 billion in the current fiscal year [5] - The airline's net income for the trailing 12 months was $2.69 billion, with EPS at $8.09, and EPS is expected to rise to $10.30, a gain of 30.55% [5] Group 4: Trip.com (TCOM) - Trip.com operates as a travel service provider primarily in China, with a unanimous strong buy rating from analysts and an average price target of $68.06 [6][7] - The company reported revenue of $44.51 billion in 2023, recovering from $18.32 billion in 2020, which was down nearly 49% from $35.67 billion in 2019 [7] - For the current year, sales are expected to grow by 20.2% to $53.5 billion, with EPS projected to rise 47% to $21.72 [7]

Table of Contents Table of Contents Exhibit 99.1 TRIP.COM GROUP LIMITED INDEX TO CONSOLIDATED FINANCIAL STATEMENTS | --- | --- | |---------------------------------------------------------------------------------------------------------------------------------------|-------| | | Page | | Unaudited Interim Condensed Consolidated Statements of Income and Comprehensive Income for the Three-month Periods Ended March 31, | | | 2023 and 2024 | F-2 | | Unaudited Interim Condensed Consolidated Balance Sheets as of D ...

Core Viewpoint - Trip.com Group Limited announced a proposed offering of US$1.3 billion in convertible senior notes due 2029, aimed at qualified institutional buyers, with an option for initial purchasers to buy an additional US$200 million [1][10]. Group 1: Notes Offering Details - The notes will be general unsecured obligations of the company, maturing on June 15, 2029, with a repurchase option for holders on June 15, 2027, at 100% of the principal amount plus accrued interest [3][4]. - The notes will be convertible under certain conditions, with cash settlement upon conversion, and the company may choose to settle in cash, American depositary shares (ADSs), or a combination [5][6]. - The company plans to repurchase up to US$400 million of its ADSs concurrently with the notes offering to offset potential dilution from the conversion of the notes [7]. Group 2: Use of Proceeds - The net proceeds from the notes offering will be used for repaying existing financial indebtedness, expanding overseas business, and meeting working capital needs [2]. Group 3: Company Overview - Trip.com Group Limited is a leading global one-stop travel platform, offering a comprehensive suite of travel products and services, and operates under brands like Ctrip, Qunar, Trip.com, and Skyscanner [12].

Investment Rating - The report assigns a "BUY" rating for Trip.com Group (TCOM) with a target price of US$65.8, up from the previous target of US$49.0, indicating a potential upside of 17.9% from the current price of US$55.83 [3][12]. Core Insights - Trip.com Group reported a net revenue of RMB11.9 billion for Q1 2024, representing a year-over-year increase of 29.4%, which exceeded both the forecast and consensus estimates [2]. - The company is positioned to capitalize on globalization opportunities beyond the current pent-up demand in the travel industry, leveraging its one-stop shop business model and strong customer service capabilities [2][7]. - Management anticipates that international business will contribute over 20% of total revenue within the next 3-5 years, supported by a significant total addressable market in Asia that is 1.5 times that of China [7][8]. Summary by Sections Financial Performance - In Q1 2024, Trip.com achieved a non-GAAP operating income of RMB3.8 billion, surpassing forecasts due to better gross profit margins and controlled marketing expenses [2][10]. - The company expects revenue for Q2 2024 to reach RMB12.9 billion, reflecting a 15% year-over-year growth [2]. Market Position and Growth Strategy - Trip.com’s domestic travel bookings grew at a double-digit rate year-over-year in Q2 2024, outpacing the overall market [9]. - The international flight capacity rebounded to 70% of pre-pandemic levels, with Trip.com outperforming the industry by 20-30% in outbound travel bookings [8][9]. - The inbound travel revenue, which accounted for approximately 20% of Trip.com’s revenue in Q1 2024, is expected to further support revenue growth [7]. Operational Efficiency - The non-GAAP operating profit margin for Q1 2024 was 31.6%, significantly better than forecasted, driven by disciplined sales and marketing spending [2][10]. - The company aims to maintain efficient marketing expenditures focused on return on investment, which is expected to stabilize the operating profit margin despite a high base [2][10]. Future Projections - Revenue projections for 2024, 2025, and 2026 are RMB52.8 billion, RMB59.5 billion, and RMB65.8 billion respectively, with corresponding growth rates of 18.5%, 12.6%, and 10.6% [10][11]. - The gross profit margin is expected to remain strong at around 81.3% for 2024, with operating margins projected to improve to 26.2% [10][11].

Financial Data and Key Metrics Changes - Trip.com Group reported a net revenue of RMB 11.9 billion for Q1 2024, representing a 29% increase year-over-year and a 15% increase quarter-over-quarter [23] - Adjusted EBITDA was RMB 4 billion for Q1 2024, compared to RMB 2.8 billion in the same period last year, with an adjusted EBITDA margin of 33% [25] - Diluted earnings per ordinary share were RMB 6.38 or USD 0.88 for Q1 2024, with non-GAAP diluted earnings per ordinary share at RMB 6 or USD 0.83 [25] Business Line Data and Key Metrics Changes - Accommodation reservation revenue for Q1 was RMB 4.5 billion, a 29% increase year-over-year and a 15% increase quarter-over-quarter [23] - Transportation ticketing revenue reached RMB 5 billion, representing a 20% increase year-over-year and a 22% increase quarter-over-quarter [23] - Packaged-tour revenue surged to RMB 883 million, a 129% increase year-over-year and a 25% increase quarter-over-quarter [23] Market Data and Key Metrics Changes - The outbound travel market saw bookings fully recover to pre-pandemic levels during major holiday periods, with outbound hotel and air ticket bookings increasing by over 100% year-over-year [13][23] - Inbound travel bookings increased by 400% year-over-year, driven by visa-free policies and strong demand from key markets [16] - The domestic market showed robust growth, with hotel and air ticket bookings increasing by 20% to 30% year-over-year [12] Company Strategy and Development Direction - The company is focusing on expanding its user base in second- and third-tier cities in China and enhancing user acquisition and cross-selling ratios [29] - Trip.com aims to capture the growing inbound travel market in China, which is projected to be a multitrillion RMB opportunity [29] - The introduction of tailor-made products for the silver generation is expected to tap into a significant market opportunity valued at RMB 1 trillion [30] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the sustainability of strong performance for the rest of 2024, citing a transition from pent-up demand to a more normalized demand environment [11] - The company anticipates continued strong demand across travel segments, despite potential challenges from declining hotel and air prices [26] - Management remains optimistic about the travel market's recovery, particularly in outbound travel, which is expected to reach 80% of pre-pandemic levels by year-end [41] Other Important Information - The company has introduced the Old Friends Club initiative to cater to the travel preferences of the silver generation, aiming to bridge the gap between peak and off-peak travel seasons [8] - Trip.com is committed to social responsibility, creating job opportunities and supporting local communities through strategic investments [21] Q&A Session Summary Question: What growth drivers should investors pay attention to? - Management highlighted the focus on expanding user base in lower-tier cities and the growth of outbound travel as key drivers [29] Question: Have you observed a decrease in hotel ADR and RevPAR? - Management confirmed a decline in domestic ADR influenced by increased outbound travel and improved hotel availability in lower-tier cities [33] Question: What was the business performance during the Labor Day holiday? - Management reported record high domestic and outbound travel bookings during the holiday, with outbound bookings surpassing 120% of 2019 levels [38] Question: What factors will impact the recovery of outbound travel? - Management noted visa applications and flight capacity as major factors influencing the recovery of outbound travel [42] Question: How does Trip.com plan to capture the inbound travel market? - Management emphasized the rich offerings of China and the introduction of free-visa policies to attract international travelers [47] Question: What is the contribution of inbound travel to Trip.com? - Inbound travel now contributes over 20% to overall revenues, reflecting significant growth [49]