Trip.com Group (NasdaqGS:TCOM) Valuation Check After Antitrust Probe And Class Action Interest

Trip.com Group (TCOM) is under investigation by China’s market regulator for potential antitrust violations, a development that has drawn securities class action interest and brought sharp focus to the stock’s recent performance.

See our latest analysis for Trip.com Group.

The regulatory probe and class action interest have coincided with a 24.0% 1 month share price decline and a weaker year to date share price return of 22.8%, even though the 3 year total shareholder return of 52.9% indicates a much stronger longer term outcome.

If this kind of regulatory headline has you reassessing your watchlist, it can help to compare with other themes. You can also check out our screener of 23 top founder-led companies as potential alternatives.

With Trip.com Group trading at a discount to some valuation estimates after a sharp recent pullback, the real question for investors is whether this legal overhang has created a genuine opportunity or if the market is already pricing in future growth.

Most Popular Narrative: 33.8% Undervalued

At a last close of $57.50 against a widely followed fair value estimate of $86.91, the current market price sits well below this narrative’s implied level, setting up a clear tension between recent regulatory headlines and longer term assumptions.

Ongoing investment in proprietary artificial intelligence, personalized recommendation engines, and integrated "one-stop" trip planning tools (like Trip.Planner and Intelli-Trip) is driving higher user engagement, stronger repeat bookings, and better operating leverage, supporting margin expansion and increased customer lifetime value.

Read the complete narrative.

Want to see what this story is really built on? Revenue rising faster than the wider market, profits expected to behave very differently, and a future earnings multiple that needs to do some heavy lifting. Curious which assumptions have to hold for that gap between $57.50 and $86.91 to make sense?

Result: Fair Value of $86.91 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, this story can break if the regulatory probe leads to tighter rules, or if direct airline and hotel booking tools steadily chip away at commission revenue.

Find out about the key risks to this Trip.com Group narrative.

Build Your Own Trip.com Group Narrative

If you see the data differently or prefer to test your own assumptions, you can build a personalized Trip.com Group view in minutes using Do it your way.

A great starting point for your Trip.com Group research is our analysis highlighting 5 key rewards and 1 important warning sign that could impact your investment decision.

Ready To Find Your Next Idea?

If Trip.com Group is already on your radar, do not stop there, use our screeners to uncover other angles your portfolio might be missing.

• Spot potential value opportunities early by scanning our list of 51 high quality undervalued stocks that may offer more than the current market price suggests.
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• Hunt for off-the-radar opportunities through the screener containing 24 high quality undiscovered gems that many investors might not be watching yet.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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