On Thursday, Trip.com Group Ltd. (HKG:09961) shares plunged by 7.5% after releasing its most recent quarterly results. The company announced its FQ3 results Wednesday after markets closed, beating the consensus analyst expectations on revenue and earnings.
The company posted FQ3 non-GAAP earnings per share of $0.13, beating the average analyst estimate of $0.01. On the other hand, its GAAP EPS of -$0.20 failed to match the Street forecast of -$0.09, while revenue for the quarter increased marginally by 3.2% from the same quarter in 2020 to $831 million, surpassing expectations by $14.37 million.
Trip.com looks undervalued
From an investment perspective, Trip.com shares trade at a compelling forward P/E ratio of 3.33, making the stock an exciting option for bargain hunters.
In addition, analysts are optimistic about the company’s growth prospects, forecasting its EPS to grow by more than 480% next year, recovering from this year’s estimated decline of 149.5%.
Therefore, it could also gain the interest of growth investors.
Technically, Trip.com shares seem to be trading within a descending channel formation in the intraday chart. As a result, the stock has recently pulled back to retest the trendline support, pushing it towards oversold conditions.
Therefore, investors could target potential technical rebounds at about $24.77, or higher at $27.55, while $20.10 and $17.52, are crucial support zones.
In summary, with Trip.com shares down 33% this year, now could be a good time to buy ahead of next year’s earnings rebound.
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