BKNG

Booking Holdings Hit By AI “Scare Trade”

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Image Source: TradingView By Brian Nelson, CFA On February 18, Booking Holdings (BKNG) reported better than expected fourth quarter results with both revenue and non-GAAP earnings per share exceeding the consensus marks. Room nights grew 9% in the quarter compared to 2024, while gross bookings advanced 16% on a year-over-year basis (11% on a constant currency basis). Total revenue grew 16% in the quarter, or roughly 11% on a constant currency basis. Adjusted earnings per share came in at $48.80, up 17% year-over-year, while adjusted EBITDA came in at $2.2 billion, up 19%. Management had the following to say about the results: We are pleased to report strong results for 2025, delivering double-digit revenue growth, expanding Adjusted EBITDA margin by … Read more

Booking Holdings Looks to Robust Growth in Fourth Quarter

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Image Source: Booking Holdings By Brian Nelson, CFA On October 28, Booking Holdings (BKNG) reported better than expected third quarter results with both revenue and non-GAAP earnings per share exceeding the consensus forecast. Revenue grew 13% compared to the third quarter of 2024, or 8% on a constant currency basis. Room nights increased 8% compared to the third quarter of 2024, while gross bookings advanced 14% compared to the same period a year ago, or 10% on a constant currency basis. Adjusted earnings per share and adjusted EBITDA expanded 19% and 15% year-over-year, respectively. Management had the following to say about the results: We are pleased to report a strong third quarter, with 8% room night growth and double-digit gains … Read more

Thinking Slow: 3 Research Blind Spots That Changed the Investment World

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Dear members: — Daniel Kahneman in his text Thinking, Fast and Slow (1) divided the human psyche into two systems. The first system is instinctive and emotional, often set on autopilot, while the second system is slower and more logical, requiring a calculating conscious. Many of the maxims the investment world takes for granted today suffer from conclusions that are made rapidly, almost without thinking, driven by our first system, creating what I call research blind spots. — In World War II, Allied bombing raids were suffering from very high casualty rates. It was estimated that for those pilots that were flying at the beginning of the war, only about 10% survived, a terrible loss rate. Bombing was crucial to the Allied … Read more

Booking Holdings Expects Mid-Teens Adjusted EBITDA Growth in 2025

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Image Source: TradingView By Brian Nelson, CFA Booking Holdings (BKNG) recently reported second quarter results that came in better than expectations. Total revenue grew 16% in the quarter, while adjusted EBITDA advanced 28% and adjusted earnings per share increased 32%. Gross bookings were up 13%, while room nights advanced 8% year-over-year. Net cash provided by operating activities increased 27%, to $3.2 billion, while free cash flow increased 32%, to $3.1 billion. Booking Holdings ended the quarter with $18.2 billion in cash and long-term investments and $18.5 billion in short- and long-term debt. It repurchased $1.3 billion of stock in the quarter, with total remaining authorization of $24.6 billion. Management had the following to say about the results: We are pleased … Read more

Delta Air Lines Restores Financial Guidance

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Image Source: TradingVIew By Brian Nelson, CFA On July 10, Delta Air Lines (DAL) reported results for its June quarter that beat consensus expectations on the top and bottom lines. On a non-GAAP basis, operating revenue came in at a record $15.5 billion, up 1% year over year, with operating income of $2 billion on an operating margin of 13.2%. Pre-tax income came in at $1.8 billion with a pre-tax margin of 11.6%. Delta reported earnings per share of $2.10 and operating cash flow of $1.8 billion in the quarter. Management had the following to say about the results: In the June quarter, Delta delivered record revenue on a 13 percent operating margin, generating $1.8 billion in pre-tax profit and … Read more

3 Undervalued Stocks to Consider Buying Now

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Dear readers:   With the markets retracing most of their recent drawdown, we’re taking a victory lap as we didn’t panic, nor should have you. We highlighted our wait-and-see approach amidst the worst of the pullback, and we expect the Magnificent 7 (large cap growth and big cap tech) to continue to propel the markets higher, as they have done.   We’ve been busy rolling valuation models as we finetune our assumptions for a great number of companies under coverage. While doing so, we came across three undervalued stocks that are also included in the simulated newsletter portfolios. We think they’re prime for highlight.   The three stocks are UnitedHealth Group (UNH), Nvidia (NVDA) and Alphabet (GOOG). We spend a lot of time on discounted cash-flow valuation, … Read more

Magnificent 7 Earnings Reports Not Bad Thus Far

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By Brian Nelson, CFA   Shortly after Trump’s Liberation Day, where the President unveiled lofty tariffs on numerous countries, we released our wait-and-see outlook for the equity markets, which thus far has proven to be the right move, with the markets largely recovering from the depths reached in April. The S&P 500 (SPY), for example, is down just 3.3% year-to-date, excluding dividends.   A lot has happened since Liberation Day, including easing of tariffs to a 10% baseline for most, if not all, countries, with the key exception of China, where tariffs remain extremely elevated and prohibitive. Many countries are now reportedly negotiating trade agreements with the White House, and we expect China to be added to that list soon, even if … Read more

Booking Holdings’ Free Cash Remains Robust

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Image Source: Booking Holdings By Brian Nelson, CFA On April 29, Best Ideas Newsletter portfolio idea Booking Holdings (BKNG) reported better than expected first quarter results with both revenue and non-GAAP earnings per share coming in higher than expected. Room nights grew 7% year-over-year, while gross bookings advanced 10% on a constant currency basis. Revenue grew 8% compared to the first quarter of 2024 and was up 10% on a currency neutral basis. Adjusted earnings per share increased 22% in the quarter on a year-over-year basis, to $24.81. Management had the following to say about the quarter: I (CEO Glenn Fogel) am pleased to report a good start to 2025 where healthy growth of room nights and gross bookings in … Read more

Trump Tariffs Higher than Expected; What We’re Doing

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By Brian Nelson, CFA The Trump tariff increases came in larger than what we were expecting, and it remains to be seen how they will flow through the global economy, as we monitor potential retaliatory tariffs from other countries. As it relates to the equity markets, we’re taking a wait and see approach at the moment as we monitor new policy changes related to trade, immigration, fiscal (tax), and regulations. In short, we’re not overreacting to the sell off as we won’t have a great handle on the tariff impact to companies for a few quarters when they report results post-tariff increases. That said, we’re expecting continued market volatility, with meaningful risk to the downside, before trade uncertainty alleviates in … Read more

Booking Holdings’ Revenue Accelerates in Fourth Quarter

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Image Source: Booking Holdings By Brian Nelson, CFA On February 20, Booking Holdings (BKNG) reported better than expected fourth quarter results with revenue and non-GAAP earnings per share exceeding the consensus forecast. Room nights grew 13% compared to the fourth quarter of 2023, while gross bookings advanced 17% year-over-year (up 18% on a constant-currency basis) in the quarter. Revenue increased 14% (up 15% on a constant-currency basis) from the same period a year ago, better than the 11% (up 12% on a constant currency basis) it recorded for all of full year 2024. Adjusted earnings per share was up 30% on a year-over-year basis, while adjusted EBITDA advanced 26%. Management had the following to say about the results: We are pleased … Read more