Jefferies downgraded Booking Holdings to Hold from Buy with a price target of $4,200, down from $4,350. The firm says sustainability of room night growth is the key debate for online travel, following disappointing guidance for the second half of 2024 and softer demand in July. Its top down industry model suggests growth will moderate further over the next three years, which causes it to take estimates below consensus. The analyst Booking’s downside to consensus is likely to outweigh its peer-leading free cash flow. While Booking offers peer-leading execution, the stock’s upside is capped by risk of downside to room nights, the analyst tells investors in a research note. Jefferies is also concerned that a currently elevated booking window could reverse in 2025, creating a near-term headwind to room night growth.
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