In "The Big Banks," Citigroup lowers Trip.com’s target price to $77, and adjusts next year's earnings forecast down by 11%

Citi published a research report indicating that Trip.com Group (09961.HK) achieved a total revenue growth of 21% year-on-year in the fourth quarter of last year, reaching RMB 15.4 billion, which was 4% higher than the bank's expectations. Adjusted EBIT grew by 16% year-on-year to RMB 3.2 billion, in line with expectations. Domestic tourism performance during the period was surprisingly strong, benefiting from robust demand and price recovery, with the business recording nearly double-digit year-on-year growth; meanwhile, its platform Trip.com Global maintained approximately 60% rapid growth.

Citi expects that domestic tourism demand will remain strong this year, with expectations for sustainable price growth. However, uncertainties surrounding antitrust investigations may put pressure on Trip.com's platform commission rates and profit margins. Consequently, it has lowered its adjusted net profit forecasts for the next two years by 8% and 11%, respectively, and reduced the target price for Trip.com (TCOM.US) on the US stock market from $82 to $77, while maintaining an "outperform" rating. The bank believes that the group's $5 billion share repurchase plan can provide some support and expects the company's total revenue in the first quarter of this year to grow by 15% year-on-year to RMB 15.9 billion