Will Booking Holdings Stock Trade Lower Post Q2?

Booking Holdings (NASDAQ: BKNG), the world’s largest online travel agency, that offers services from lodging to airline tickets to car rentals, is scheduled to announce its fiscal second-quarter results on Thursday, August 3. We expect the company’s stock to likely trade lower with revenues and earnings missing market expectations. Booking Holdings has fully recovered from the difficult period caused by the pandemic in terms of revenues. However, its operating income of $450 million in Q1 2023 is still below pre-pandemic values ($556 million in 2019), although it improved compared to Q1 2022. In Q1 2023, the Board of Directors authorized a share repurchase program of about $20 billion which shows that there is the potential to increase EPS in the coming quarters. Still, uncertain macro conditions pose a risk for the business in 2023. Going forward, BKNG expects Q2 2023 room night growth to be up mid-single-digits year-over-year (y-o-y). In addition, BKNG’s fixed expenses in Q2 will grow about 25% y-o-y due to higher personnel and related expenses, indirect taxes, and IT expense. For the full-year 2023, the company expects its adjusted EBITDA margin to expand by a couple of percentage points versus 2022.

Our forecast indicates that Booking Holdings’ valuation is $2722 per share, which is 10% lower than the current market price. Look at our interactive dashboard analysis on Booking Holdings Earnings Preview: What To Expect in Q2? for more details.