UBS raises Trip.com target price to 700 yuan, reiterates "Buy" rating

UBS released a report indicating that Trip.com-S (09961.HK) performed solidly in the third quarter, with revenue and profit exceeding expectations. Entering the fourth quarter, the bank expects overseas business to continue its strong momentum, driving total revenue growth to accelerate to high double-digit levels.

UBS estimates that "Trip.com Overseas" will see revenue growth of over 50% year-on-year in the last quarter, accounting for 18% of total revenue. The outbound tourism business revenue growth is expected to remain in the mid-double-digit range (approximately 13% to 17%), with limited impact from the Japanese market, as leisure travelers tend to switch destinations. Meanwhile, the bank expects domestic business revenue in the fourth quarter to remain resilient, benefiting from an increase in hotel occupancy nights, although the average daily room rate may still record a low single-digit decline.

The report states that Trip.com (TCOM.US) is currently trading at a projected price-to-earnings ratio of 17 times for 2026, close to the recent trading range low, and believes the risk-reward ratio remains attractive, reiterating a "Buy" rating. The target price for U.S. stocks is raised from $85 to $90. The target price for Hong Kong stocks is raised from HKD 660 to HKD 700