Priceline just reported numbers for the March quarter and revenues came in at $2.15 billion and earnings per share were $10.54 per share. A nice beat on the earnings front.
However, for the current quarter, Priceline is guiding earnings to a range of $11.60 per share and $12.50 per share or $12.05 per share which is significantly lower than current Wall Street expectations of $$14.98 per share. The company says its revenues will also be up in a range of 7% to 14% (YoY) or between $2.44 billion and $2.60 billion. Let's call that $2.52 billion at the mid-point.
A huge take-down for the current quarter.
Wall Street expected Priceline to report earnings of $9.66 per share on revenues of $2.12 billion for the March quarter. For the current quarter, the analysts had expected earnings of $14.98 per share on revenues of $2.65 billion.
Jeffery Boyd, the new interim CEO didn't say a thing about the takedown but I will be listening in on the call to get a better picture on the trends and the reasons for the lowered guidance.
In sort of related news, the report is that Priceline's ousted CEO, Darren Huston relationship with a co-worker came to light due to a whistleblower tip from within the company.
“An anonymous hotline, as far as we’re concerned, is the epitome of best practices for protecting a company against fraud,” said Kenneth H. Springer, executive vice president of Corporate Resolutions. Such hotlines are simple to put in place, don’t cost very much money and allow even small- and mid-sized businesses to make sure their employees have an outlet in which to report what they suspect to be illegal activity, unethical conduct or problems with sexual or racial harassment, said Mr. Springer.
What an obviously self-interested Mr. Springer does not say the flipped is an atmosphere of mistrust and suspicion and a culture of snitches created by these hotlines. The potential for abuse of these hotlines are also extremely common place with work-place rivals making calls anonymously to falsely accuse workers they do not like or to drag down co-workers who are performing better than themselves in the form of "tips" on these company hotlines.
All I am trying to say, is that these hotlines are a double-edged sword and a better solution might be to create a company culture that does not require "snitching" or "whistle-blowing" to be politically correct.
Having said that and back to Priceline, terrible earnings guidance from the company and the shares are getting taken to the woodshed in pre-market trading, down $155 per share to $1,200 per share on volume of 33,000 shares.
More than likely, Priceline's cohorts like
(Long pcln, long and short calls, long pcln puts, long trip puts)
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