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Booking Holdings Inc BKNG

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Morningstar’s Analysis

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Booking’s Demand and Network Advantage Strengthen in Q2; Shares Undervalued

Dan Wasiolek Senior Equity Analyst

Analyst Note

| Dan Wasiolek |

Booking’s second quarter saw strong demand improvement and progress toward building out a connected trip, supporting its strengthening network advantage (source of its narrow moat). Despite incorporating an expected increase in the U.S. statutory rate to 26% from 21% starting in 2022, we plan to increase our $2,340 fair value estimate around a low-single-digit percentage to account for stronger near-term demand. We see shares of this high-quality company as undervalued.

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Company Profile

Business Description

Booking is the world’s largest online travel agency by sales, offering booking services for hotel and alternative accommodation rooms, airline tickets, rental cars, restaurant reservations, cruises, experiences, and other vacation packages. The company operates a number of branded travel booking sites, including, Agoda, OpenTable, and, and has expanded into travel media with the acquisitions of Kayak and Momondo. Transaction fees for online bookings account for the bulk of revenue and profits.

800 Connecticut Avenue
Norwalk, CT, 06854
T +1 203 299-8000
Sector Consumer Cyclical
Industry Travel Services
Most Recent Earnings Jun 30, 2021
Fiscal Year End Dec 31, 2020
Stock Type Cyclical
Employees 19,500