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3 Things This Shareholder Will Look For in Ctrip.com International's First-Quarter Earnings

CTRP Gross Profit Margin (Quarterly) Chart
CTRP Gross Profit Margin (Quarterly) Chart

Data by YCharts .

After falling for four consecutive years, gross margins showed signs of expansion in 2015. With CEO and founder James Liang indicating that some "rationality" was once again being practiced in terms of pricing in the Chinese OTA market, I hope to see continued improvement in gross margins during the quarter.

Relations with airlines

One of the not-so-great things about acquisitions is that you acquire all of a company's baggage along with its business. Qunar's biggest piece of baggage is a terrible relationship with some of the biggest airlines in Asia, including Air China , Hawaiian Airlines ' Hong Kong Airlines, and China Eastern Airlines . Because of various disputes, all three of these companies refuse to list on Qunar's portal.

At the time of the acquisition, all three had good relationships with Ctrip and continued to list on Ctrip's site. But there's always concern that with Ctrip and Qunar being so closely tied together, the airlines could revolt.

In late April, China Eastern and Ctrip went public with a "strategic collaboration" that should ease some fears. However, it will be important for investors to monitor relations with Air China and Hong Kong Airlines to make sure they remain healthy.

Surely, this should make for an interesting report and conference call as investors try to understand what this newer, larger, and more dominant Chinese OTA is really capable of.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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