Booking Holdings Upgraded to Buy Amid AI Concerns
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 5 days ago
0mins
Should l Buy BKNG?
Source: CNBC
- Rating Upgrade: Gordon Haskett Research Advisors upgraded Booking Holdings from hold to buy, with analyst Robert Mollins setting a price target of $5,440, indicating a 28% upside, reflecting strong conviction in the company's potential.
- Market Reaction: Despite a 14% decline in share price over the past 12 months and a 21% drop this year, the analyst believes investors have overreacted to AI competition fears, overlooking Booking's operational advantages and defensive moat.
- Financial Expectations: Ahead of the fourth-quarter earnings report on February 18, Mollins anticipates that the company will exceed current consensus and guidance in room nights, which should positively impact revenue, EBITDA, and EPS performance.
- Investment Opportunity: The analyst highlights that the current valuation presents a compelling buying opportunity, especially as the valuation premium relative to peers narrows despite significantly stronger margins, suggesting a low-risk, high-reward investment scenario.
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Analyst Views on BKNG
Wall Street analysts forecast BKNG stock price to rise
25 Analyst Rating
18 Buy
7 Hold
0 Sell
Moderate Buy
Current: 4159.100
Low
5407
Averages
6153
High
6850
Current: 4159.100
Low
5407
Averages
6153
High
6850
About BKNG
Booking Holdings Inc. is a provider of travel and restaurant online reservation and related services. The Company offers its services through five primary consumer-facing brands: Booking.com, Priceline, Agoda, KAYAK, and OpenTable. Through its brands, consumers can book an array of accommodations (including hotels, motels, resorts, homes, apartments, bed and breakfasts, hostels, and other alternative and traditional accommodation properties) and a flight to their destinations; make a car rental reservation or arrange for an airport taxi; make a dinner reservation; or book a vacation package, tour, activity, or cruise. Consumers can also use its meta-search services to easily compare travel reservation information, such as flight, hotel, and rental car reservations from hundreds of online travel platforms at once. Booking.com offers accommodation reservation services for approximately 4.0 million properties in over 220 countries and territories and in over 40 languages.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Booking Holdings Faces AI Challenges and Investment Opportunities
- Stock Price Decline: As of February 11, Booking Holdings has seen its stock price drop by 20% since the beginning of the year and 27% from its June peak, making its valuation more attractive to investors despite the bearish market sentiment.
- AI Investment and Risks: The company's significant investment in AI technology, including the development of an in-house AI trip planner and a partnership with OpenAI, enhances service capabilities but raises concerns about the future of the travel booking industry, potentially putting Booking Holdings at risk of obsolescence.
- Revenue Growth Expectations: Analysts forecast a 17% revenue increase for Q4 2025 and a 22% increase for 2025, significantly above the company's own 12% growth forecast, although growth is expected to slow to 18% in 2026, indicating sustained business growth potential.
- Valuation Attractiveness: Booking Holdings currently has a P/E ratio of 28, below the S&P 500 average of 30 and well below last summer's 40, with analysts predicting a forward P/E of 16, suggesting significant profit growth potential, even as the stock approaches 52-week lows.
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- Stock Decline Trend: As of February 11, Booking Holdings' stock has fallen 20% since the beginning of the year and is down 27% from its June high, reflecting investor concerns over AI and other challenges, leading to significant sell-offs.
- Earnings Outlook: The company is set to report its fourth-quarter results for 2025 on February 18, with analysts forecasting a 17% revenue increase for the quarter and a 22% increase for 2025, exceeding the company's own 12% growth forecast, indicating ongoing business expansion.
- Valuation Appeal: Booking Holdings currently has a P/E ratio of 28, below the S&P 500 average of 30 and significantly lower than its 40 multiple from last summer, with a forward P/E of 16 suggesting substantial profit growth potential ahead.
- AI Investment and Market Reaction: Despite Booking Holdings' heavy investments in AI technology, including a partnership with OpenAI, concerns about AI potentially transforming the travel booking industry persist, contributing to the ongoing decline in stock price.
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- Increased Market Volatility: Last week, stocks in software, real estate, financial services, and logistics faced selling pressure due to concerns over AI-related disruptions, with the Nasdaq Composite falling 0.2% and a weekly loss of 2.1%, indicating market sensitivity to AI impacts.
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Booking Holdings Faces AI Challenges and Investment Opportunities
- Stock Price Decline: As of February 11, Booking Holdings has seen its stock price drop by 20% since the beginning of the year and 27% from its June peak, making its valuation more attractive to investors despite the bearish market sentiment.
- AI Investment and Risks: The company's significant investment in AI technology, including the development of an in-house AI trip planner and a partnership with OpenAI, enhances service capabilities but raises concerns about the future of the travel booking industry, potentially putting Booking Holdings at risk of obsolescence.
- Revenue Growth Expectations: Analysts forecast a 17% revenue increase for Q4 2025 and a 22% increase for 2025, significantly above the company's own 12% growth forecast, although growth is expected to slow to 18% in 2026, indicating sustained business growth potential.
- Valuation Attractiveness: Booking Holdings currently has a P/E ratio of 28, below the S&P 500 average of 30 and well below last summer's 40, with analysts predicting a forward P/E of 16, suggesting significant profit growth potential, even as the stock approaches 52-week lows.
See More
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- New Position Established: Harvard Management Co. has established a new position in the iShares Ethereum Trust ETF by acquiring 3,870,900 shares, with an estimated transaction value of $86.82 million, indicating a sustained interest in the digital asset market.
- Asset Allocation Proportion: This investment represents 4.18% of Harvard Management's reportable U.S. equity assets as of December 31, 2025, highlighting its significance within a diversified investment portfolio.
- ETF Performance Analysis: As of February 14, 2026, the Ethereum ETF's share price stands at $15.44, reflecting a 23.90% decline over the past year, underperforming the S&P 500 by approximately 35%, which indicates market caution towards this asset.
- Long-term Investment Strategy: Harvard's investment portfolio includes 19 positions with total reportable assets of $2.08 billion, demonstrating a strategic focus on diversification and long-term growth potential.
See More
Harvard Management Acquires ETHA Shares
- Significant Investment: Harvard Management recently acquired 3.87 million shares of the iShares Ethereum Trust ETF (ETHA), with an estimated transaction value of $86.82 million, indicating its ongoing commitment to the digital asset market.
- Diversified Asset Allocation: This investment represents 4.18% of Harvard Management's 13F reportable assets, highlighting its focus on cryptocurrency, particularly the potential of Ethereum within a diversified investment portfolio.
- Market Performance Comparison: Despite ETHA's 41.32% decline since inception, while the iShares Bitcoin ETF (IBIT) has risen approximately 40% since January 2024, Harvard Management remains optimistic about the long-term outlook of the crypto market, viewing ETHA as a viable investment option.
- Portfolio Management Expertise: Harvard's investment portfolio holds only 19 assets across various sectors, including commodities, real estate, technology, and cryptocurrencies, demonstrating its professional capabilities in risk management and yield optimization.
See More
Analysis of Booking Holdings' 20% Stock Decline
- Stock Decline Trend: As of February 11, Booking Holdings' stock has fallen 20% since the beginning of the year and is down 27% from its June high, reflecting investor concerns over AI and other challenges, leading to significant sell-offs.
- Earnings Outlook: The company is set to report its fourth-quarter results for 2025 on February 18, with analysts forecasting a 17% revenue increase for the quarter and a 22% increase for 2025, exceeding the company's own 12% growth forecast, indicating ongoing business expansion.
- Valuation Appeal: Booking Holdings currently has a P/E ratio of 28, below the S&P 500 average of 30 and significantly lower than its 40 multiple from last summer, with a forward P/E of 16 suggesting substantial profit growth potential ahead.
- AI Investment and Market Reaction: Despite Booking Holdings' heavy investments in AI technology, including a partnership with OpenAI, concerns about AI potentially transforming the travel booking industry persist, contributing to the ongoing decline in stock price.
See More
Key Companies to Monitor This Week: PCE, Walmart, Palo Alto, Analog Devices, Deere, and Others
- Market Performance: Equities experienced a decline last week, with all three major indexes falling by at least 1.2%.
- Economic Indicators: This downturn occurred despite a better-than-expected jobs report from the Bureau of Labor Statistics and a relatively stable inflation report.
See More
AI Turbulence Impacts Market Performance
- Increased Market Volatility: Last week, stocks in software, real estate, financial services, and logistics faced selling pressure due to concerns over AI-related disruptions, with the Nasdaq Composite falling 0.2% and a weekly loss of 2.1%, indicating market sensitivity to AI impacts.
- Consumer Spending Data Focus: This week's highlight will be the Personal Consumption Expenditures (PCE) report on Friday, which will provide insights into consumer spending in December and inflation trends, especially following last week's unexpected slowdown in the Consumer Price Index (CPI).
- Corporate Earnings in Spotlight: Walmart (WMT) is set to release its fourth-quarter earnings on Thursday, marking the first report under new CEO John Furner, making it a key indicator of consumer spending that the market is eagerly anticipating.
- Ongoing AI Impact: As AI tools' potential effects intensify across various sectors, software stocks like Salesforce (CRM) and ServiceNow (NOW) have seen significant declines, reflecting the market's heightened vigilance regarding AI disruptions, necessitating close monitoring of future industry developments.
See More
