Priceline Group Stock Targeting $2,000
Priceline Group – A League of Its Own
While many speculators are constantly on the prowl for the next penny stock ten bagger, core holdings in your portfolio should always include some time tested large-cap stocks. These are stocks that you can hand down to your kids (or not) and include market share dominant leaders like online travel site Priceline Group Inc (NASDAQ:PCLN).
What makes PCLN stock truly special is the share price has multiplied over 145 times from its $12.00 value in 2003.
You may think the easy gains have been made in stock and you are probably right but that doesn’t mean there are no longer opportunities.
In January, when I last reviewed Priceline Group, the PCLN stock was trading at just below $1,500. If you bought then, your position would be up nearly 20% after PCLN stock reached a record high of $1,759 on Friday.
Priceline Group has doubled the return of the S&P 500 over the past 52-weeks and has delivered alpha to investors, which calculates the return based on the beta or risk.
The provider of online travel products has been stellar performer for Wall Street. Priceline Group has not missed an EPS estimate in 16 straight quarters and has beaten the consensus in 50% of the time so consistency is a key for PCLN stock.
If you are looking for another breakout after the current record move, the strongest quarter for Priceline Group in terms of the per share earnings is the third quarter ending in September. While the company has not beaten the consensus EPS in three straight third quarters, the price of PCLN stock tends to jump in October.
Of course, Priceline Group should be added as a long-term investment that could withstand the passage of time unless something revolutionary surfaces to challenge the company’s business model. This could happen but not likely anytime soon.
My Bullish Case for PCLN
The long-term chart of PCLN stock is characterized by multiple breakouts and upward trending moving averages since trading at around $12.00 in 2003. We saw breakouts at $25.00 in 2006, $100.00 in 2009, $700.00 in 2013, and $1,350 in August 2016.
Chart courtesy of StockCharts.com
PCLN stock has been in a bullish golden cross (50-day MA above the 200-day MA) since 2007 and this shows no signs of reversing.
The most recent bullish gap up breakout was from $1,650 to $1,700 in late February that has resulted in the record move on Friday.
Chart courtesy of StockCharts.com
If you are a trader, you have several avenues. You can accumulate on a dip as PCLN stock is likely to pause with some support seen at 1,700 to $1,750. After this, Priceline Group stock could likely target an achievable $2,000, a 14% move from the current levels.
If you are familiar with options, you can manage the risk via selling put options at a lower strike price to establish a potential entry price and generate some premium income or you can look at call options as a limited risk trade on the long side.
