MakeMyTrip Reports Strong Bookings but Profit Declines
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Jul 23 2024
0mins
Source: NASDAQ.COM
MakeMyTrip Ltd (MMYT) saw its stock drop by 8.34% after crossing below the 5-day SMA, despite reporting an 11% year-over-year increase in gross bookings for Q3.
The company's unadjusted profit fell to $7.3 million, down 73% year-over-year, primarily due to significant increases in income tax expenses and finance costs related to convertible notes. Although adjusted EPS of $0.52 exceeded market expectations by $0.10, concerns over high expenses affecting profitability led to a negative market reaction.
This decline in stock price reflects market apprehension despite the strong gross bookings growth, indicating that investors are cautious about the company's ability to manage costs effectively in a competitive environment.
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Analyst Views on MMYT
Wall Street analysts forecast MMYT stock price to rise
3 Analyst Rating
3 Buy
0 Hold
0 Sell
Strong Buy
Current: 57.350
Low
113.00
Averages
118.00
High
123.00
Current: 57.350
Low
113.00
Averages
118.00
High
123.00
About MMYT
MakeMyTrip Limited is an online travel provider. The Company's segments include Air Ticketing, Hotels and Packages, and Bus Ticketing. The Air ticketing segment provides the facility to book domestic and international air tickets through Internet-based platforms. The Hotels and packages segment provides holiday packages and hotel reservations through Internet-based platforms, call centers, and franchise stores. The Bus ticketing segment provides the facility to book domestic and international bus tickets through Internet-based platforms. Through its primary websites, such as www.makemytrip.com, www.goibibo.com, and www.redbus.in, and mobile platforms, travelers can research, plan and book a range of travel services and products in India, as well as overseas. The Company's services and products include air ticketing, hotels and packages, bus tickets, rail tickets, car hire, activities and experiences, and ancillary travel requirements. It also provides an inter-city car rental service.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Strong Online Travel Performance: Expedia Group and MakeMyTrip rose over 9%, while Booking Holdings increased around 8%, and Airbnb and TripAdvisor advanced about 4% and 3% respectively, indicating a robust rebound in consumer demand for leisure travel.
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- Analyst Rating Decline: Currently, MakeMyTrip holds a Zacks Rank of #5 (Strong Sell) in the Internet - Delivery Services sector, placing it in the bottom 9% of the industry rankings, reflecting a pessimistic outlook from the market regarding its future performance.
- Earnings Estimate Adjustments: Over the past 30 days, no analysts have raised their earnings estimates for MakeMyTrip's current quarter, while one analyst has revised the estimate downward, resulting in a drop in the Zacks Consensus Estimate from $52 per share to $10, indicating a significant decline in profitability expectations.
- Trading Strategy Implications: The high implied volatility may attract options traders to employ a strategy of selling options to capture decay, although this also reflects the market's uncertainty regarding MakeMyTrip's future price movements.
See More
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- Net Income Decline: Despite revenue growth, net income fell to $24.2 million from $29.2 million a year earlier, reflecting the adverse impact of rising finance costs on profitability, which may affect investor confidence moving forward.
- Full-Year Performance: For the fiscal year 2026, total revenue reached $1.04 billion, up from $978.3 million, yet net income decreased from $95.1 million to $51.8 million, highlighting profitability pressures amid expansion efforts.
- Stock Price Volatility: MMYT is currently trading at $39.47, down $5.46 or 12.15%, indicating market concerns regarding the company's financial performance, which could impact its future financing capabilities.
See More
MakeMyTrip (MMYT) Q4 2026 Earnings Transcript
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