Booking Holdings Trades Flat After Earnings, Revenues Top Forecasts

Booking Holdings Inc. (BKNG) shares traded mostly unchanged in Wednesday’s extended-hours session after the travel booking company reported quarterly financial results that came in ahead of Wall Street expectations but revealed ongoing industry weakness as reimposed travel restrictions in many parts of the world continue to present challenges.

The $100 billion-dollar company behind popular travel sites, such as Priceline.com, Booking.com, Agoda, OpenTable, and Kayak, posted a Q4 loss of 57 cents per share, much narrower than the $5.08 earnings per share (EPS) loss analysts had forecast. However, the metric plunged significantly from earnings of $23.30 in the year-ago quarter. Likewise, revenues of $1.24 billion came in ahead of the consensus mark but declined from sales of $3.34 billion in the December 2019 quarter.

CEO Glenn Fogel told investors during the earnings call that lockdowns – particularly in the United Kingdom – had continued to weigh on the company, but things had started to turn around in the current quarter.

“The travel environment continued to be challenging through the fourth quarter of 2020 and into January 2021 as COVID-19 case counts remained very high and travel restrictions were reimposed in many parts of the world. However, in recent weeks, we have started to see some improvements in booking trends that we will continue to monitor,” Fogel said, per Bloomberg.

Despite the headwinds facing the travel giant, its stock has gained 18.40% over the past three months as of Feb. 25, 2021. Year to date (YTD), the share price has added nearly 10%.

Wall Street View

This week, Credit Suisse analyst Stephen Ju lifted the investment bank’s price target on the stock to $2,430 from $2,170 while reiterating his ‘Overweight’ rating. Ju sees long-term profit potential, given the company’s substantial exposure to leisure travel.

Other brokerage coverage also remains bullish, with many analysts looking for a recovery in travel demand as the year progresses. The stock receives 10 ‘Buy’ ratings, 19 ‘Hold’ ratings, and 1 ‘Underweight’ rating. Wednesday’s $2,443.50 close represents an 8.6% premium to Wall Street’s 12-month median price target of $2,250.

Technical Outlook and Trading Tactics

After a retracement in between the 50-day and 200-day simple moving averages (SMAs), the Booking Holdings share price surged to a new all-time high (ATH) this week on increasing volume as investors positioned for a better-than-expected earnings report.

After the recent gains and the RSI indicator pointing to overbought conditions, active traders should look to open long positions between $2,090 and $2,290, where the price finds a zone of support from an 18-month horizontal trendline and the early January swing high.

For a look at today’s earnings schedule, check out our earnings calendar.