Story
Citi Reiterates Buy Ratings on Trip.com, Tongcheng Ahead of China's Autumn Holidays
Summary
Citi analysts are bullish on Chinese travel platforms Trip.com and Tongcheng Travel, citing attractive valuations and the potential for upcoming national holidays to serve as a key demand catalyst.
Analysts at Citi have reiterated Buy ratings on two of China's leading online travel agencies, Trip.com (TCOM) and Tongcheng Travel (0780.HK), seeing a favorable risk-reward profile as their valuations hover near post-reopening lows.
Holiday Demand Seen as Key Catalyst
According to a Citi research note, the upcoming Mid-Autumn Festival and the October 1 Golden Week holidays are poised to be significant catalysts for the travel sector. The bank anticipates a surge in travel demand as more consumers take annual leave for extended vacations during these periods.
This optimistic outlook comes despite several near-term headwinds. Citi acknowledged that both companies face pressure from broader macroeconomic softness, extreme weather events, and elevated oil prices. However, the bank believes these risks have been largely priced into the current stock values.
Company-Specific Outlook
Citi provided distinct analyses for each platform, expecting Trip.com to show stronger relative performance in 2027.
Trip.com (TCOM)
AdCiti expects Trip.com to benefit from a mild recovery in outbound international travel and solid momentum from its global platform. While the firm flagged near-term volatility in hotel take-rates and pressure on domestic air and rail commissions, it anticipates that disciplined cost control will support margins.
Other analyst firms have also weighed in on Trip.com recently. Citing factors including an antitrust ruling and pressure on domestic travel, StoneX, Mizuho, and BofA Securities all lowered their price targets to $60 while maintaining their respective Buy or Outperform ratings.
Tongcheng Travel (0780.HK)
For Tongcheng, Citi noted that management has adopted a conservative tone for the second half of 2026. Despite this, the bank believes the company's margins will hold up well due to cost discipline. Tongcheng is expected to face continued pressure on its take-rates for domestic air and rail bookings.
In its most recent financial report for the second quarter of 2026, Tongcheng posted a 6.8% year-over-year rise in revenue to RMB 5.0 billion and a 9.8% increase in adjusted net profit to RMB 851 million.
Read next
More on Stocks
Accenture Shares Jump 6% on $1 Billion AI Safety Partnership with Anthropic
Shares of IT services firm Accenture rose sharply in premarket trading after it announced a major partnership with AI developer Anthropic to conduct independent safety evaluations of its models, backed by a planned joint investment of at least $1 billion.
Paramount Skydance Shares Surge on $1.5 Billion Concession to Advance Warner Bros. Deal
The media company's stock jumped after it disclosed talks for a major investment in California production, a move seen as a key step toward resolving legal challenges blocking its acquisition of Warner Bros. Discovery.
Warner Bros. Discovery Stock Jumps on Report of Paramount Merger Settlement Talks
Shares of Warner Bros. Discovery surged after reports indicated progress in settlement talks between Paramount and state attorneys general, potentially clearing a major hurdle for the company's $31.00-per-share acquisition.
Porsche CEO Denies Report of Additional 4,000 Job Cuts
Porsche CEO Michael Leiters has dismissed a media report claiming the automaker planned an additional 4,000 job cuts, reassuring staff in an internal memo that the company is sticking to its existing restructuring plan.