Booking Holdings (BKNG) AI Stock Analysis

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Booking Holdings

(NASDAQ:BKNG)

Select Model

Outperform 71 (OpenAI - 5.2)

Rating:71Outperform

Price Target:

$4,718.00

▲(11.29% Upside)

Action:UpgradedDate:02/19/26

The score is driven primarily by strong financial performance (profitability and cash flow) and a bullish earnings-call outlook with margin expansion and cost-savings execution. Offsetting these strengths are elevated balance-sheet risk (negative equity and rising debt) and weak technicals (below key moving averages with negative MACD), while valuation is reasonable but not particularly cheap.

Positive Factors

Free Cash Flow Generation

Consistent, large free cash flow (~$9.1B) and rising operating cash flow support durable self-funding of growth, buybacks, dividends and reinvestment. High cash conversion (FCF tracking net income ~95–97%) underpins resilience through cycles and funds strategic initiatives without relying exclusively on external financing.

Market Scale & Payments Momentum

Large merchant mix and ~$130B merchant bookings expand payments and fintech revenue streams, diversifying margins and deepening supplier relationships. Scale across brands and categories strengthens pricing power, distribution leverage and cross‑sell opportunities that persistently drive higher take‑rate revenue.

Operational Leverage & Margin Expansion

Meaningful margin expansion and operating leverage — fixed operating costs growing slower than revenue — indicate scalable cost structure. Sustained high adjusted EBITDA margins provide buffers for reinvestment and competitive pricing while enabling durable profitability under modest demand swings.

Negative Factors

Elevated Leverage & Negative Equity

Meaningful indebtedness and multi‑year negative shareholder equity reduce financial flexibility and increase refinancing and covenant risk during stress. While earnings and cash flow are strong, atypical leverage metrics constrain strategic optionality and make downside scenarios more balance‑sheet sensitive.

Planned Reinvestment Drag on EBITDA

Management's choice to self‑fund sizeable reinvestment (~$700M) will deliberately reduce near‑term EBITDA by ~ $300M. While strategic, this slows immediate margin improvement and tightens coverage metrics, leaving less cushion to rapidly pay down leverage if macro weakens or cash conversion stalls.

Top‑Line Deceleration & Product Challenges

Recent slowing revenue growth and softer segments (alternative accommodations, some U.S. ADR softness) suggest product and inventory gaps versus peers. Structural deceleration risks eroding booking momentum and could require sustained investment to regain faster growth, pressuring medium‑term returns.

Booking Holdings (BKNG) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$134.27B

Dividend Yield0.71%

Average Volume (3M)484.50K

Price to Earnings (P/E)25.6

Beta (1Y)1.16

Revenue Growth12.96%

EPS Growth3.66%

CountryUS

Employees24,500

SectorConsumer Cyclical

Sector Strength84

IndustryTravel Services

Share Statistics

EPS (TTM)48.80

Shares Outstanding31,673,346

10 Day Avg. Volume688,679

30 Day Avg. Volume484,501

Financial Highlights & Ratios

PEG Ratio-6.67

Price to Book (P/B)-31.16

Price to Sales (P/S)6.46

P/FCF Ratio19.13

Enterprise Value/Market Cap1.02

Enterprise Value/Revenue5.08

Enterprise Value/Gross Profit5.12

Enterprise Value/Ebitda14.99

Forecast

1Y Price Target

$5,828.04

Price Target Upside37.47% Upside

Rating ConsensusStrong Buy

Number of Analyst Covering27

EPS Forecast (FY)268.64

Revenue Forecast (FY)$29.96B

Booking Holdings Business Overview & Revenue Model

Company DescriptionBooking Holdings Inc. provides travel and restaurant online reservation and related services worldwide. The company operates Booking.com, which offers online accommodation reservations; Rentalcars.com that provides online rental car reservation services; Priceline, which offer online travel reservation services, and consumers hotel, flight, and rental car reservation services, as well as vacation packages, cruises, and hotel distribution services. It also operates Agoda that provides online accommodation reservation services, as well as flight, ground transportation and activities reservation services. In addition, the company operates KAYAK, an online price comparison service that allows consumers to search and compare travel itineraries and prices, comprising airline ticket, accommodation reservation, and rental car reservation information; and OpenTable for booking online restaurant reservations. Further, it offers travel-related insurance products, and restaurant management services to consumers, travel service providers, and restaurants. The company was formerly known as The Priceline Group Inc. and changed its name to Booking Holdings Inc. in February 2018. The company was founded in 1997 and is headquartered in Norwalk, Connecticut.

How the Company Makes MoneyBooking Holdings primarily generates revenue through commissions and service fees charged to travel service providers, such as hotels and airlines, for facilitating bookings through its platforms. The company earns a significant portion of its revenue from hotel reservations, where it takes a percentage of the booking price from the property owners. Additionally, it earns income from advertising on its websites and apps, as well as from offering ancillary services like travel insurance and car rentals. Key partnerships with various travel and hospitality companies enhance its offerings and drive additional revenue. The company's scale and global reach allow it to negotiate favorable terms with suppliers, further optimizing its revenue generation.

Booking Holdings Key Performance Indicators (KPIs)

Any

Revenue by Segment

Revenue by Segment
Breaks down revenue across different business segments, revealing which areas are driving growth and where there may be potential risks or opportunities.

Chart InsightsBooking Holdings' Merchant segment is experiencing robust growth, outpacing other segments, driven by strategic advancements in AI and the Genius loyalty program. The recent earnings call highlights a 13% revenue increase and strong U.S. market performance, despite slightly lower ADRs. The company's focus on AI and technology is reshaping the travel experience, contributing to sustained growth. However, geopolitical and macroeconomic uncertainties remain potential risks. Overall, the Merchant segment's momentum, supported by strategic initiatives, positions Booking Holdings well for continued success.

Data provided by:

The Fly

Booking Holdings Earnings Call Summary

Earnings Call Date:Feb 18, 2026

(Q4-2025)

% Change Since: |

Next Earnings Date:May 06, 2026

Earnings Call Sentiment Positive

The call presented a strong set of financial and operational outcomes — above-guidance Q4 performance, double-digit top-line growth, substantial margin expansion, significant free cash flow and aggressive shareholder returns — alongside strategic progress in GenAI, Connected Trip, flights and payments. Management also highlighted disciplined cost savings via the Transformation Program and plans to self-fund sizeable reinvestments to drive future growth. Key near-term headwinds include opportunistic marketing deleverage in Q4, higher payment costs from a larger merchant mix, some U.S. ADR softness, and a planned reinvestment cadence that will modestly dampen 2026 EBITDA. Overall, the positives (robust growth, margin expansion, cash generation and strategic investment) substantially outweigh the manageable challenges reported.

Q4-2025 Updates

Positive Updates

Quarterly Room Night Growth Outperformed

Q4 room nights reached 285 million, up 9% year-over-year and exceeding the high end of guidance by ~3 percentage points, driven by healthy demand across major regions.

Strong Q4 Top-Line and Profitability

Fourth quarter gross bookings and revenue both increased 16% year-over-year; adjusted EBITDA was ~$2.2 billion, up 19% year-over-year; adjusted EPS grew 17% year-over-year.

Full-Year Revenue and EBITDA Expansion

Full year gross bookings grew 12% and revenue grew 13% year-over-year; adjusted EBITDA exceeded $9.9 billion, up 20% year-over-year, with adjusted EBITDA margin of 36.9% (up 193 basis points).

Transformation Program Delivered Meaningful Savings

Transformation Program enabled approximately $550 million in annual run-rate savings by year-end (met high end of prior guidance), delivered ~$250 million of in-year savings in 2025 and realized ~$130 million of in-quarter savings in Q4.

Strong Free Cash Flow and Capital Returns

Generated roughly $9.1 billion in free cash flow for the full year (up 15% vs. 2024); returned $8.2 billion to shareholders in 2025 (including $5.9 billion share repurchases and $1.2 billion dividends); share count down ~22% since restart of repurchases.

Connected Trip and Multi-Vertical Momentum

Connected Trip transactions grew in the high-20% range and comprised a low double-digit percentage of Booking.com's transactions; flights bookings reached ~68 million tickets (+37% year-over-year) representing $16.8 billion in gross bookings; attraction tickets grew nearly 80% year-over-year.

Merchant Mix and Payments Growth

Merchant gross bookings were $130 billion, up 25% year-over-year and represented ~70% of total gross bookings (up from ~63% in 2024); revenue as a percentage of gross bookings increased to 14.5% (from 14.3%), helped by higher payments revenue.

Loyalty and Direct Channel Strength

Genius Levels 2 and 3 accounted for a high-50% share of room nights in 2025 (up from mid-50% in 2024) and higher direct-booking rates; B2C direct mix remained mid-60% and mobile app mix rose to mid-50% of room nights.

Operational Leverage and Cost Discipline

Adjusted fixed operating expenses were up 7% year-over-year (about 4% in constant currency), which was ~6 percentage points lower than revenue growth, contributing to operating leverage and margin expansion.

Balance Sheet and Shareholder Actions

Q4 cash and investments $17.8 billion; Board approved a 9.4% increase to the quarterly dividend to $10.50 per share and a 25-for-1 stock split; management targets continued capital returns and investment-grade leverage (~2x through the cycle).

Negative Updates

Marketing Deleverage in Q4

Marketing expense as a percentage of gross bookings was ~24 basis points higher year-over-year in Q4 due to opportunistic investments in performance and social channels and increased brand spend, creating short-term deleverage.

Higher Payment Costs from Merchant Mix

Merchant mix increased (merchant gross bookings ~70% of total), which drove higher payment expenses in Q4 and was a partial offset to sales and other expense leverage.

Lower ADRs and Shorter Length of Stay in U.S.

U.S. experienced slightly lower average daily rates (ADRs) and a slightly shorter length of stay versus the prior year in Q4, suggesting some consumer caution in discretionary spending among certain segments.

Alternative Accommodation Growth Moderation

Alternative accommodations grew ~10% for the full year and ~9% in Q4 vs. prior periods; management acknowledged tougher compares and room for further product and inventory improvements to reaccelerate growth.

Quarterly Tax Timing Impact on EPS

Q4 adjusted EPS growth (17% YoY) lagged adjusted EBITDA growth due to a higher tax rate in the quarter driven largely by timing of certain adjustments.

Near-Term Reinvestment Drag on EBITDA

Management plans to reinvest approximately $700 million above baseline in 2026 (GenAI, Connected Trip, fintech, advertising, international expansion), expected to produce ~$400 million incremental revenue but result in a net ~ $300 million impact to adjusted EBITDA in 2026.

Company Guidance

Booking Holdings guided that for full‑year 2026 it expects constant‑currency top‑line growth about 100 basis points above its 8% long‑term algorithm (i.e., roughly ~9%), with reported gross bookings and revenue up low double‑digits, adjusted EBITDA growing faster than revenue and adjusted EBITDA margins expanding by about 50 basis points, and adjusted EPS up in the mid‑teens (constant‑currency EPS growth in line with a ~15% target). The company assumes EUR/USD at $1.17 and expects FX to boost full‑year reported growth by ~2.5 p.p. for gross bookings, ~2 p.p. for revenue and ~1.5 p.p. for adjusted EBITDA and EPS; Q1 FX is expected to add ~7 p.p. to gross bookings/revenue and ~8 p.p. to adjusted EBITDA. Q1 2026 guidance is room nights +5–7%, gross bookings +14–16% (>1 p.p. from flights/other), revenue +14–16%, adjusted EBITDA +10–14% (~20% at the high end after normalizing a $53M prior‑year benefit), and Q1 accommodation ADRs roughly flat. The Transformation Program is expected to deliver $500–550M of in‑year savings in 2026 (run‑rate savings ~ $550M targeted by year‑end, aggregate costs <1x run rate), and the company plans ~ $700M of reinvestment above baseline that it says will drive ~$400M of incremental revenue and about $300M of net contribution to adjusted EBITDA, while keeping sales & other expenses as a percentage of gross bookings roughly flat.

Booking Holdings Financial Statement Overview

Summary

Strong profitability and excellent cash generation (rising operating cash flow and ~$9.1B free cash flow in 2025) support a solid operating profile, but the balance sheet is a major offset with meaningful leverage and negative shareholder equity in 2023–2025, reducing financial flexibility.

Income Statement

Positive

Revenue has expanded strongly from 2020 to 2024 (6.8B to 23.7B) with continued growth in 2025 (to 26.9B, +3.4% year over year). Profitability is solid: net margins have stayed around ~18–25% from 2022–2025, and operating profitability (EBITDA margin) remains healthy (~22% in 2025). The main weakness is decelerating top-line growth in the most recent year and some inconsistency in reported profitability details (e.g., 2025 gross profit and EBIT margin fields appear not populated), which reduces confidence in margin trend precision.

Balance Sheet

Negative

Leverage is meaningful with total debt rising to ~19.3B in 2025, while shareholder equity is negative from 2023–2025 (approximately -2.7B to -5.6B). This results in atypical leverage and return metrics (negative debt-to-equity and negative return on equity), which is a balance-sheet risk signal and reduces financial flexibility despite strong earnings. A positive is that the asset base has grown (to ~29.3B in 2025), but the negative equity profile is the dominant concern.

Cash Flow

Very Positive

Cash generation is a clear strength: operating cash flow increased from ~7.3B (2023) to ~8.3B (2024) and ~9.4B (2025), with free cash flow also rising to ~9.1B in 2025. Free cash flow closely tracks net income (about ~95–97% in 2023–2025), indicating earnings quality and good cash conversion. The main drawback is that operating cash flow covers only about ~53–56% of total debt in 2023–2025 (based on the provided coverage measure), implying debt paydown capacity is solid but not fast if conditions weaken.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	26.92B	23.74B	21.36B	17.09B	10.96B
Gross Profit	26.15B	23.74B	21.36B	17.09B	10.96B
EBITDA	10.26B	9.34B	7.04B	4.92B	2.40B
Net Income	5.40B	5.88B	4.29B	3.06B	1.17B
Balance Sheet
Total Assets	29.26B	27.71B	24.34B	25.36B	23.64B
Cash, Cash Equivalents and Short-Term Investments	17.79B	16.16B	12.68B	12.43B	11.15B
Total Debt	19.29B	17.08B	14.78B	13.04B	11.28B
Total Liabilities	34.84B	31.73B	27.09B	22.58B	17.46B
Stockholders Equity	-5.58B	-4.02B	-2.74B	2.78B	6.18B
Cash Flow
Free Cash Flow	9.09B	7.89B	7.00B	6.19B	2.52B
Operating Cash Flow	9.41B	8.32B	7.34B	6.55B	2.82B
Investing Cash Flow	-313.00M	129.00M	1.49B	-518.00M	-998.00M
Financing Cash Flow	-8.91B	-4.20B	-8.91B	-4.90B	-1.24B

Booking Holdings Technical Analysis

Technical Analysis Sentiment

Negative

Last Price4239.35

Price Trends

50DMA

4909.81

Negative

100DMA

4986.76

Negative

200DMA

5246.95

Negative

Market Momentum

MACD

-229.54

Negative

RSI

41.60

Neutral

STOCH

81.81

Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For BKNG, the sentiment is Negative. The current price of 4239.35 is below the 20-day moving average (MA) of 4324.66, below the 50-day MA of 4909.81, and below the 200-day MA of 5246.95, indicating a bearish trend. The MACD of -229.54 indicates Negative momentum. The RSI at 41.60 is Neutral, neither overbought nor oversold. The STOCH value of 81.81 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for BKNG.

Booking Holdings Risk Analysis

Booking Holdings disclosed 34 risk factors in its most recent earnings report. Booking Holdings reported the most risks in the "Finance & Corporate" category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

Booking Holdings Peers Comparison

Overall Rating

UnderperformOutperform

Sector (61)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ABNB	75 Outperform	$82.24B	33.43	30.23%	―	10.56%	47.16%
BKNG	71 Outperform	$134.27B	25.60	―	0.71%	12.96%	3.66%
TCOM	71 Outperform	$34.67B	8.45	19.95%	0.39%	17.34%	91.51%
EXPE	62 Neutral	$26.43B	21.99	91.09%	0.56%	7.29%	36.51%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
MMYT	53 Neutral	$5.36B	112.92	13.02%	―	14.55%	-68.46%
TRIP	51 Neutral	$1.16B	33.79	5.04%	―	4.24%	159.81%

* Consumer Cyclical Sector Average

Performance Comparison

BKNG

Booking Holdings

4,239.35

-670.32

-13.65%

TCOM

Trip.com Group Sponsored ADR

52.62

-4.93

-8.56%

EXPE

Expedia

215.69

23.74

12.37%

MMYT

Makemytrip

56.47

-38.07

-40.27%

TRIP

TripAdvisor

10.11

-4.28

-29.74%

ABNB

Airbnb

135.11

-5.87

-4.16%

Booking Holdings Corporate Events

Business Operations and StrategyStock BuybackDividendsFinancial DisclosuresStock Split

Booking Holdings Posts Strong 2025 Results, Plans Stock Split

Positive

Feb 18, 2026

Booking Holdings reported strong fourth-quarter and full-year 2025 results on February 18, 2026, with Q4 room nights up 9% and gross bookings and revenue each rising 16% year over year, while net income grew 34% and GAAP EPS 38%. For 2025, room nights increased 8%, gross bookings 12% and revenue 13% versus 2024, with adjusted EBITDA up 20% and margin improving to 36.9% despite a lower net income margin, reflecting solid operational leverage and continued investment.

The company enabled about $550 million in annual run-rate savings through its Transformation Program and plans to reinvest those savings in 2026 to support long-term growth, including expanded use of generative AI. It also stepped up capital returns, repurchasing $2.1 billion of stock in Q4 2025, raising its quarterly dividend 9.4% to $10.50 per share payable March 31, 2026, and announcing a 25-for-1 forward stock split effective April 2, 2026, moves that could broaden its shareholder base and underscore management’s confidence in future performance.

The most recent analyst rating on (BKNG) stock is a Buy with a $6250.00 price target. To see the full list of analyst forecasts on Booking Holdings stock, see the BKNG Stock Forecast page.

Glossary

BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Feb 19, 2026