Trip.com Stock Soars on Delisting from Nasdaq
Asian travel booking giant Trip.com Group Ltd. (Nasdaq: TCOM) is looking to delist from Nasdaq; the news sent TCOM stock soaring 11% in pre-market Wednesday, to $30.81 per American depositary share.
More known as "Ctrip," the company is reportedly in talks with investors who may fund its exit from U.S. trading amid the ever-worsening Sino-American relations and travel restrictions due to the coronavirus, according to various sources.
Ctrip's business was hit hard during the Covid-19 outbreak. For the first quarter, the travel platform posted a 42% drop in revenues year-over-year, to $669 million, though it was also able to reduce its costs and expenses. Net loss mounted to $754 million in contrast to income of $657.1 million a year ago. In mid-March, Ctrip's top management announced it took salary cuts.
TCOM stock fell from its mid-January high of $38.94 per share to just above $20 per ADS in March and April and, while it's been on a jagged uptrend since, it has still not fully recovered to its pre-coronavirus level.
According to Reuters, another factor in Ctrip's delisting is the tightening regulatory environment on Wall Street. U.S. regulators are raising the bar in auditing standards and may force Chinese companies to disclose having ties to the government. Earlier, the clampdown led another Chinese tech giant, Baidu Inc. (Nasdaq: BIDU), to weigh other public trading options, though its delisting plans have not been confirmed.
Prior to the Covid-19 outbreak, Trip.com reportedly considered a secondary listing on the Stock Exchange of Hong Kong.
Trip.com declined to comment on an inquiry from CapitalWatch.
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