Booking Holdings (NASDAQ: BKNG) stock is up approximately 42% since the start of 2024, outpacing the S&P 500—which has risen by 28% over the same period. In contrast, its peer Expedia (NASDAQ: EXPE) is up 30% during the same period. Read What’s Driving The Stock Rally For Expedia? to learn more. So, what is happening here?
Booking Holdings delivered better-than-expected results across every operational metric in Q4, including revenues and profitability. An extended booking window and growth in all geographic regions fueled the company’s performance. The firm is leveraging AI and technology to improve efficiency and enhance customer experience. It is incorporating generative AI into its services—such as AI-powered trip planning and Priceline’s AI-powered travel assistant, Penny—while also upgrading its mobile applications and payment systems to streamline operations and boost engagement. Additionally, if you prefer a less volatile investment than an individual stock, consider the High Quality portfolio, which has outperformed the S&P and delivered over 91% returns since inception.
In Q4 2024, the online travel agency’s revenues increased by 14% year-over-year to $5.5 billion, fueled by a 17% year-over-year rise in gross bookings to $37.2 billion. Room nights booked grew by 13% compared to the previous year’s quarter, rental car days increased by 12% year-over-year, and airline tickets booked surged by 52% year-over-year in Q4. Moreover, BKNG’s adjusted EBITDA rose by 26% year-over-year to $1.8 billion, driven by stronger revenue performance and lower-than-expected adjusted fixed operating expenses. Its earnings per share were $41.55, up 30% year-over-year. It is noteworthy that the Q4 increase in Booking’s per-share earnings was supported by stock buybacks, which reduced the share count by about 5%. Additionally, Booking Holdings’ alternative accommodations segment exhibited steady growth in Q4, with listings reaching 7.9 million—marking an 8% year-over-year increase.
We forecast Booking Holdings’ revenues to reach $26.2 billion for fiscal year 2025, representing a 10% year-over-year increase. On the bottom line, our EPS forecast is now $209.17. In light of the revised revenue and earnings estimates, we have adjusted our Booking Holdings’ Valuation to approximately $5227 per share, based on an expected EPS of $209.17 and a 25.0x P/E multiple for fiscal year 2025—which is nearly aligned with the current market price. Last month, Booking’s board approved a new $20 billion stock buyback program, supplementing the remaining $7.7 billion from a $24 billion program authorized in Q1 2023. Moreover, a 10% quarterly dividend increase to $9.60 per share has been scheduled for March 31.
The increase in BKNG stock over the past four years has been quite inconsistent, with annual returns being significantly more volatile than those of the S&P 500. The stock returned 8% in 2021, -16% in 2022, 76% in 2023, and 41% in 2024. In contrast, the Trefis High Quality Portfolio, which comprises 30 stocks, is considerably less volatile and has comfortably outperformed the S&P 500 over the past four years. Why is that? As a group, HQ Portfolio stocks have delivered superior returns with lower risk compared to the benchmark index, resulting in a less turbulent ride—as shown in HQ Portfolio performance metrics.
Booking has provided its growth outlook, forecasting a 2-4% year-over-year revenue increase for the first quarter of 2025, along with a 5-7% rise in gross bookings. For the full year, the company expects to maintain this momentum—with both revenue and gross bookings projected to grow in the mid-single-digit percentage range. Additionally, adjusted EPS is expected to increase in the low double-digit percentage range.
It is also useful to compare how its peers perform. Review how Booking Holdings’ Peers fare on key metrics. Additionally, you can find other valuable comparisons for companies across various industries at Peer Comparisons.
Invest with Trefis
Market Beating Portfolios | Rules-Based Wealth