Is the price right on Priceline?

Although he calls the stock "much-maligned," Mark Skousen has issued a buy on Priceline Incorporated (NASDAQ:PCLN), which he says is "coming back with a vengeance."

The editor of Forecasts & Strategies explains: "There's probably no larger group of stocks that fit the turnaround mode than technology, especially the 'dot com' companies that were decimated by the tech wreck in the early 2000s.

"One such stock is Priceline.com, the online travel agency that allows customers to 'name their own price.' Its service offers retail airline tickets, hotel reservations, car rentals, vacation packages, destination services, cruises trips, and travel insurance.

"And the company's strategy is working. Priceline yesterday reported that its fourth-quarter earnings more than tripled from the prior year. It earned $13.2 million, or 33 cents a share, compared to $3.8 million, or 9 cents a share, in the fourth-quarter of 2005.

"Revenue rose 28% to $260 million in fourth quarter 2006, compared with $203.9 million in the year-ago quarter. Profit margins at Priceline are at 6% and rising."

Skousen recommends buying Priceline.com at market and setting a protective stop of $42. And for those familiar with options and willing to take greater risks, he suggests that you consider buying the July $50 calls.

Steven Halpern's TheStockAdvisors.com provides a free, daily overview of the latest stock ideas from the nation's leading financial newsletters.