Priceline (PCLN): A technical breakout

Priceline (NASDAQ: PCLN), the global online travel service company; has seens its stock drive higher today to clear a six-week flat base.

The stock is a market leader. The tape action based on block trades indicates good and steady institutional buying interest. Technically, the stock continued higher clearing the breakpoint line at 240 with room to spare.

PCLN offers customers a range of travel services, including hotel rooms, car rentals, airline tickets, vacation packages, cruises and destination services. It offers hotel room reservations in some 75 countries.

In the U.S., the company offers customers the ability to purchase travel via Name Your Own Price service, which allows the customers to make offers for travel services at discounted prices. The Company is also engaged in offering financial services through Priceline Mortgage Company LLC.

PCLN's 12-month performance shows the stock appreciating 200% versus a 45% gain for the S&P 500 index. The stock has bounced back strongly from the bear market downdraft in 2008 which pulled it back to 45.

The daiily chart shows the stock with a recent strong run up form 160 to 260. The move included a breakout from a cup-and-handle base at 240.

The stock's momentum indicator is solidly bullish. The accumulation - distribution line is in a strong up trend indicating good buying pressure.

The company will report first quarter net on May 10. The Street is looking for a 73% surge in net to $1.49 a share from 86 cents a year ago.

First quarter net should be $1.49 a share. The highest estimate is at $1.56 a share. The past four quarters, PCLN has topped the consensus by a wide margin ranging from 12% to 30% more than the consensus. TTD sees good chances for an upside surprise.

PCLN strong earnings now indicate that the travel industry is bouncing back from the recession. This year, analysts have been forecasting 2010 net for PCLN will jump 34% to $10.54 a share from $7.87 a year ago. They have been boosting their estimates.

Going out to 2011, the Street looks for a 23% gain in net to #12.91 a share from the anticipated $1.0.54.

Strategy Opinion: PCLN is a leader that is breaking out with a strong earnings outlook. TTD is targeting the stock for a move to 320. A protective stop can be placed near 260. TTD rates PCLN a very good intermediate-term play.

Sponsorship: Excellent. The largest fund holder is Fidelity Contrafund, 5-star rated, with a 2.1% stake. It was a recent buyer of 87,100 shares. A large key buyer recently was 3-star rated CGM Focus Fund, which purchased 673,300 shares. PCLN has 44 million shares outstanding.