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Valued at a market cap of $171.3 billion, Booking Holdings Inc. (BKNG) provides online and traditional travel and restaurant reservations and related services. The Norwalk, Connecticut-based company’s travel-related offerings cover hotel rooms, airline tickets, rental cars, vacation packages, cruises, 'things to do' at customer destinations, and travel insurance.
Shares of this travel company have significantly outpaced the broader market over the past 52 weeks. BKNG has rallied 67.4% over this time frame, while the broader S&P 500 Index ($SPX) has gained 32.1%. Moreover, on a YTD basis, the stock is up 47%, compared to SPX’s 26.2% gain.
Narrowing the focus, BKNG’s outperformance becomes more evident when compared to the Consumer Discretionary Select Sector SPDR Fund’s (XLY) 31.4% gain over the past 52 weeks and 23.7% return on a YTD basis.
Shares of BKNG jumped 4.8% after its better-than-expected Q3 earnings release on Oct. 30. Its adjusted EPS of $83.89 surpassed the Wall Street estimates of $77.94 and increased 16% from a year ago. Moreover, its revenue climbed 8.9% year-over-year to $7.99 billion and outpaced the consensus estimates of $7.63 billion.
The company benefited from efficient cost management and robust room night growth, primarily driven by stronger performance in Europe coupled with strong growth in the alternative accommodation segment and a 39% increase in airline ticket bookings, fueled by the continued growth in flight offerings by Booking.com and Agoda.
For the current fiscal year, ending in December, analysts expect BKNG’s EPS to grow 19.2% year over year to $181.49. The company’s earnings surprise history is promising. It beat the consensus estimates in each of the last four quarters.
However, among the 34 analysts covering the stock, the consensus rating is a “Moderate Buy,” which is based on 18 “Strong Buy,” two “Moderate Buy,” and 14 “Hold” ratings.
The configuration is less bullish than three months ago, with 21 analysts suggesting a “Strong Buy.”
On Nov. 18, Tigress Financial maintained a “Strong Buy” rating on BKNG and raised its price target to $5,600- the Street-high price target, which indicates a 7.4% potential upside from the current levels. As of writing, BKNG is trading above its mean price target of $5,053.76.
