By Jeff Reeves
Editor, InvestorPlace.com and The Slant
Online travel retailer Priceline.com (NASDAQ:PCLN) may not seem like a wise pick in lean times, but big growth overseas and strong positioning as a low-cost option for consumers are two big reasons to give this pick a look.
The appeal of Priceline — beyond the William Shatner factor, of course — is that most travelers now use this site (or ones like it) as the default way to book trips, hotels and rental cars for both vacations and business trips. And while tough economic times mean less travel, they don’t mean no travel.
Consider that while many retailers have had lackluster fundamentals over the past few years, PCLN has seen a simply stunning 15 straight quarters of year-over-year revenue growth dating back to the Great Recession. Profits are up in eight consecutive quarters. These results are due to big growth at home but also in foreign markets — Priceline now operates in about 100 countries and over 40 languages.
Priceline has a reasonable forward P/E of about 16.5 — not unheard of in specialty retail, particularly for a high-growth stock like this. Shares are up more than 30% in 2012 and a dramatic 500% in the last five years, so there is a real risk of overheating, but thus far the music hasn’t stopped; Q3 earnings were very strong and the company is expecting 15% to 20% growth next quarter, too.