Review: Ctrip.com Emerges from the Ashes

On our December 16, 2011 Nasdaq 100 Watch List, we reviewed the prospects of Ctrip.com (CTRP).  In that assessment we said the following (found here):

“Ctrip.com International (CTRP) is on a pace to replicate the performance from the high in April 2008 to the low of January 2009 which equaled a loss of 72%. A similar decline in CTRP from the high of $50.57 would bring the price down to $14.16. Suffice to say, the stock ‘only’ needs to decline another $8.94 or 38% from the current price of 23.10. This seems very easy considering the high volatility of Chinese stocks. We believe that unless CTRP is summarily dismissed from the Nasdaq 100 index, there may yet be life in this company.”

Amazingly, Ctrip.com fell equally as much in the period from the 2010 high to the most recent low as it did from April 2008 high to the January 2009 low.  Our preliminary review of Ctrip.com at the low on December 16, 2011 at $23.10 suggested that the stock could drop as low as $10 a share.  However, this never happened as Ctrip.com declined as low as $12.44 and then rebounded.

Today, Ctrip.com’s stock increased as much as +23% as it was reported that the company beat analyst earnings expectations.  For those who purchased CTRP at $14.16 and below, the gains of over +67% need to be secured.   Investors seeking to build a diversified portfolio should sell the principal and reinvest elsewhere.  Potential investment opportunities could be found on our latest U.S. Dividend Watch List, Nasdaq 100 Watch List or Canadian Watch List.