Better Prices with Priceline?

I'm a big fan of travel Websites, but Priceline (www.priceline.com) is one I have yet to try. It's the site known for allowing customers to bid on hotel rooms--in other words, you can specify the date and city and the price you will pay for a room, and Priceline will find you a place at that price if anything is available. Like the other big travel sites, Priceline also offers deals on flights, cruises and rental cars, as well as last minute deals.
Some of their last minute flight deals are impressive--Chicago to New York for $234, a 50 per cent reduction from the published price if you booked within two days of departure. Most of the last minute deals seem to be for U.S. destinations. There are sales for the next three days on four-star hotels in many U.S. cities--Chicago, Houston, New Orleans, Dallas, Altanta, San Diego with rooms available at $99. The rates for weekends at hotels in various U.S. cities are even more impressive, as low as $45/
Priceline must be doing something right, because its stock price has been soaring (it's listed on the Nasdaq.) It is trading at around $627 per share today, and has a market capitalization of more than $31 billion. Revenue per share is listed on Yahoo finance at $101, with a return on equity of 44 per cent.
In general I avoid high-priced stocks and Internet stocks, and this is certainly not a stock recommendation. I remember the first dot-com crash when Internet stocks were valued to some extent on their burn rate, or the rate at which they were burning through cash. I believe the accounting with these stocks has been cleaned up since then, (at least I hope so.)
I usually don't mix travel and investing, but I am interested in why this particular stock is doing well. I would welcome comments from readers who have used Priceline, or those who have invested in it.