2025-11-18 09:41Summary of Trip.com Group Ltd (TCOM) Conference Call Company Overview - Company: Trip.com Group Ltd (TCOM) - Industry: China Internet and Other Services - Market Cap: US$48.82 billion - Stock Rating: Overweight - Price Target: US$83.00, representing a 17% upside from the current price of US$70.89 as of November 17, 2025 Key Financial Highlights - 3Q25 Revenue: Rmb18.2 billion, up 16% YoY, 1% above Morgan Stanley estimates [2][4] - Segment Performance: - Hotel Revenue: Up 18% YoY - Flight Revenue: Up 12% YoY - International OTA GTV: Up 60% YoY - Outbound Volume: Recovered to 140% of pre-COVID levels [2] - Non-GAAP Operating Profit: Rmb6.1 billion, up 12% YoY, 4% above estimates [3] - Non-GAAP Net Profit: Rmb19.2 billion, up 221% YoY, primarily due to Rmb17 billion in other income from the sale of MMYT stake [3] Detailed Financial Metrics - Operating Margin: 33.4%, 1.2 percentage points above estimates [3] - Net Revenue: Rmb18.338 billion, up 16% YoY [4] - Gross Profit: Rmb14.979 billion, with a gross margin of 81.7% [4] - Profit Before Tax: Rmb23.098 billion, a 315% increase YoY [4] - Net Income to Shareholders: Rmb19.919 billion, up 165% YoY [4] Future Outlook - EPS Estimates: - FY 2025: Rmb26.62 - FY 2026: Rmb29.45 - FY 2027: Rmb33.50 [6] - Revenue Projections: - FY 2025: Rmb61.347 billion - FY 2026: Rmb68.881 billion - FY 2027: Rmb76.381 billion [6] Risks and Considerations - Upside Risks: - Rebound in macroeconomic growth and RMB - Recovery in outbound travel growth [10] - Downside Risks: - Rising competition from domestic players like Tongcheng Travel and Meituan - Pandemic uncertainties and macroeconomic slowdown affecting travel demand [10] Valuation Methodology - Valuation Method: Discounted Cash Flow (DCF) - Key Assumptions: - WACC of 10.5% - Terminal growth rate of 3% - FX rate of 7.15 [9] Conclusion Trip.com Group Ltd shows strong financial performance with significant growth in revenue and profit metrics, driven by recovery in travel demand. The company is well-positioned for future growth, although it faces competitive and macroeconomic risks. The stock is rated as Overweight with a favorable price target indicating potential upside.