Booking Holdings (BKNG) has received a new Hold rating, initiated by Mizuho Securities analyst, Wei Fang.
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Wei Fang has given his Hold rating due to a combination of factors that reflect both the strengths and challenges facing Booking Holdings. The company has demonstrated impressive execution with a consistent growth trajectory in gross bookings, but the growth in Alternative Accommodations is beginning to slow, making future growth targets more challenging. While Booking Holdings is on track to achieve its revenue and earnings growth targets, the valuation appears balanced with a price-to-earnings ratio slightly above the historical average, which tempers the potential for significant upside.
Moreover, the company is undergoing a transformation plan aimed at cost reduction and strategic reinvestment, which could enhance margins and operational efficiency. However, the impact of these initiatives remains uncertain, particularly in terms of reinvestment returns. Additionally, competition from Airbnb poses a potential risk, particularly concerning valuation multiples rather than fundamental performance. These factors contribute to a cautious outlook, justifying the Hold rating as the risk/reward profile appears balanced at this time.
In another report released on September 24, TR | OpenAI – 4o also reiterated a Hold rating on the stock with a $5,906.00 price target.