Booking Holdings Inc. (NASDAQ: BKNG)

Sector: Consumer Cyclical Industry: Travel Services CIK: 0001075531
Market Cap 176.65 Bn
P/B 46.11
P/E 51.94
P/S 12.17
ROIC (Qtr) 53.75
Div Yield % 0.23
Rev 1y % (Qtr) 12.68
Total Debt (Qtr) 17.53 Bn
Debt/Equity (Qtr) -3.70
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About

Investment thesis

Bull case

  • Strong operating cash flow of 8.64B provides robust 0.49x coverage of total debt 17.53B, indicating excellent debt servicing capability and financial flexibility.
  • Healthy cash reserves of 16.51B provide 16.53x coverage of short-term debt 999M, demonstrating strong liquidity position and minimal refinancing risk.
  • Robust free cash flow of 8.31B exceeds capital expenditure of 325M by 25.58x, indicating strong organic growth funding capability.
  • Operating cash flow of 8.64B provides strong 14x coverage of stock compensation 617M, indicating sustainable incentive practices.
  • Retained earnings of 39.55B provide full 2.39x coverage of long-term debt 16.53B, indicating strong internal capital position.

Bear case

  • Operating cash flow of 8.64B barely covers its investment activities of (317M), with a coverage ratio of -27.26, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Operating cash flow of 8.64B provides thin coverage of dividend payments of (1.23B) with a -7.02 ratio, suggesting potential dividend sustainability issues if operational performance deteriorates.
  • Operating cash flow of 8.64B provides insufficient coverage of deferred revenue obligations of 6.28B, which is 1.38x, raising concerns about future service delivery capabilities.
  • Free cash flow of 8.31B represents just -6.22x of debt issuance (1.34B), suggesting concerning reliance on leverage rather than internal cash generation for growth.
  • Retained earnings of 39.55B provide limited buffer against comprehensive income items of (301M), which is -131.41x, indicating elevated exposure to market risks.

Segments Breakdown of Revenue (2024)

Product and Service Breakdown of Revenue (2024)

Peer comparison

Companies in the Travel Services
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 BKNG Booking Holdings Inc. 176.65 Bn 51.94 12.17 17.53 Bn
2 RCL Royal Caribbean Cruises Ltd 87.73 Bn 20.55 4.89 22.04 Bn
3 ABNB Airbnb, Inc. 76.08 Bn 30.30 6.22 2.00 Bn
4 CCL Carnival Corp 42.95 Bn 15.56 1.61 27.99 Bn
5 TCOM Trip.com Group Ltd 36.86 Bn 8.42 4.39 4.49 Bn
6 VIK Viking Holdings Ltd 34.07 Bn 35.81 5.56 5.65 Bn
7 EXPE Expedia Group, Inc. 25.13 Bn 19.42 1.71 6.42 Bn
8 NCLH Norwegian Cruise Line Holdings Ltd. 10.73 Bn 16.17 1.11 14.52 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 6.24 1.63
EV to Cash from Ops. EV/CFO 41.39 25.22
EV to Debt EV to Debt 10.24 0.32
EV to EBIT EV/EBIT 39.59 8.12
EV to EBITDA EV/EBITDA 35.00 8.69
EV to Free Cash Flow [EV/FCF] EV/FCF 44.88 16.59
EV to Market Cap EV to Market Cap 1.02 0.91
EV to Revenue EV/Rev 12.36 3.15
Price to Book Value [P/B] P/B 46.11 -22.19
Price to Earnings [P/E] P/E 51.94 47.79
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Div Coverage (Qtr) 4.10 -2.21
Dividend Payout Ratio % Div Payout % (Qtr) 24.20 29.35
Dividend per Basic Share Div per Share (Qtr) 37.55 2.51
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 14.62 7.02
Interest Coverage Int. cover (Qtr) 4.48 2.13
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) 27.29 -26.27
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) 4.65 879.96
Dividend Growth (1y) % Div 1y % (Qtr) 43.05 17.96
EBIAT Growth (1y) % EBIAT 1y % (Qtr) 10.91 221.93
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 29.98 -4.91
EBIT Growth (1y) % EBIT 1y % (Qtr) 17.84 195.76
EBT Growth (1y) % EBT 1y % (Qtr) 6.42 69.12
EPS Growth (1y) % EPS 1y % (Qtr) 3.02 153.49
FCF Growth (1y) % FCF 1y % (Qtr) -2.19 40.03
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 12.96 101.51
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.91 0.39
Cash Payout Ratio Cash Payout (Qtr) 0.14 0.03
Cash Ratio Cash Ratio (Qtr) 1.02 0.43
Current Ratio Curr Ratio (Qtr) 1.33 1.11
Debt to Equity Ratio Debt/Equity (Qtr) -3.70 -5.94
Interest Cover Ratio Int Coverage (Qtr) 4.48 2.13
Times Interest Earned Times Interest Earned (Qtr) 4.48 2.13
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 35.30 -25.59
EBIT Margin % EBIT Margin % (Qtr) 32.29 -3.90
EBT Margin % EBT Margin % (Qtr) 25.09 -33.52
Gross Margin % Gross Margin % (Qtr) 100.00 52.98
Net Profit Margin % Net Margin % (Qtr) 19.40 -35.95