Goldman Sachs Comments On Ctrip.com's Earnings Results, Lowers PT

Ctrip.com's CTRP 4Q revenues and earnings were above Goldman Sachs' and consensus expectations. Revenues grew 39% YoY, and the material earnings beat was in part helped by a government subsidy. 1Q11 guidance for 20% revenue growth was below our/consensus expectations for 37%/34% growth, attributed to conservatism from particularly limited visibility as CNY holiday ended last week, high 1Q10 base, and possibly softer traveler sentiment. By segment, hotels were guided to +10% yoy, air +15%, packaged tour +70%, and corporate travel +15%; absolute commissions to be stable. Goldman Sachs views the materially below-consensus 1Q guidance (even considering Ctrip's usual conservatism) as adding to investor uncertainty over impact of competition and softer travel demand, even prior to peak high-speed rail impact, which could keep shares range-bound. On the back of the results Goldman lowers 2011/2012E EPS by 2%/3% and introduce 2013E estimates. Goldman Sachs lowers its PT to $42 and has a Neutral rating on CTRP CTRP closed Friday at $42.97