PCLN is expected to report fourth quarter earnings tomorrow before the open. There is a conference call scheduled for tomorrow morning at 7:30 AM ET. 

Consensus calls for EPS of $11.81 (versus $10.85 last year) on revenue of $1.956 billion, up 6% YoY). 

The current consensus is within the company's guidance range of $11.10-11.90 & $1.86-1.99 bln. The company is expected to guide for the first quarter where consensus stands at $9.60 & $2.067 billion.


Gross bookings is the first important metric. Las quarter, the company reported gross travel bookings of $14.8 bln, which was up 7% YoY (or ~22% on a constant currency basis). PCLN's gross profit for the 3rd quarter was $2.9 billion, a 12% increase from the prior year (approximately 29% on a constant currency basis). International operations contributed gross profit in the 3rd quarter of $2.6 billion, an 11% increase versus a year ago (~ 29% on a constant currency basis). 

Looking ahead to the fourth quarter, the company is expecting total gross travel bookings to increase ~1-8% (an increase of ~13-20% on a constant currency basis). International gross travel bookings are expected to increase 3-10 in Q4 (or ~17-24% on a constant currency basis).  

The next area of interest will be adjusted EBITDA. Adjusted EBITDA for the 3rd quarter 2015 was $1.6 billion, an increase of 12% versus a year ago. Looking ahead to the fourth quarter, the company is expecting adjusted EBITDA of $710-760 mln (versus $712 mln in the same quarter as last year.

Options Activity

  • Based on the PCLN February $1080 straddle, the options market is currently pricing in a move of ~13% in either direction by February expiration (Friday).

Technical Perspective

  • On a positive report, look for resistance near the $1100-1125 area, while support sits near the $1025-1050 vicinity.