2025-09-23 02:34Summary of Trip.com Group Ltd Conference Call Company and Industry Overview - Company: Trip.com Group Ltd (TCOM.O) - Industry: China Internet and Other Services, specifically focusing on the travel industry in the Asia Pacific region Key Points and Arguments 1. Upcoming Catalyst: The travel industry data release around the National Day and Mid-Autumn Festival is expected to be a significant catalyst for share prices [1][2] 2. Holiday Data Expectations: Strong travel data is anticipated due to the overlap of the two holidays, which is not the case in 2024, where a 6.3% year-over-year (YoY) growth was recorded [2] 3. Impact on Earnings: The holiday data will be crucial for TCOM's 4Q25 earnings, with the Ministry of Cultural and Tourism expected to report tourist receipts data on October 9 [2] 4. Potential Outcomes: - Scenario 1: Tourist receipts up 7% YoY (40% probability) - Scenario 2: Tourist receipts up 8% YoY or above (40% probability) - Scenario 3: Tourist receipts up 6% YoY or below (20% probability) [3] 5. Stock Price Implications: - Scenario 1: Share price remains flat (US$77) - Scenario 2: Share price increases by 5%+ (US$81) - Scenario 3: Share price decreases by 5% (US$73) [4][5] Financial Metrics and Projections 1. Current Stock Rating: Overweight with a price target of US$83.00, indicating an 8% upside from the current price of US$76.79 [6] 2. Market Capitalization: Approximately US$52.886 billion [6] 3. Earnings Projections: - EPS (Rmb): 26.20 for FY 2024, increasing to 33.50 by FY 2027 - Revenue (Rmb million): Expected to grow from 53,294 in FY 2024 to 76,381 in FY 2027 [6] 4. Valuation Ratios: - P/E Ratio: Expected to range from 20.4 in FY 2024 to 16.6 in FY 2027 - ROE: Projected to be around 13.8% in FY 2024, stabilizing around 12.1% by FY 2027 [6] Risks and Considerations 1. Upside Risks: - Strong pent-up demand in the travel sector - Reduced competition in lower-tier cities leading to improved margins [12] 2. Downside Risks: - Softer macroeconomic growth in China affecting price-sensitive consumers - Increased competition from domestic players like Tongcheng Travel and Meituan [13] Additional Insights - The upcoming holiday data is viewed as a critical indicator for both Trip.com and its competitor Tongcheng Travel, suggesting a broader impact on the online travel agency (OTA) sector [2][4] - The analysis indicates a cautious optimism regarding the travel industry's recovery, contingent on macroeconomic conditions and competitive dynamics [12][13]