Booking Holdings Inc. (BKNG) Comparative Analysis with Peers: Key Findings and Investment Opportunity

As a frequent Booking Holdings Inc. (BKNG) customer, the author analyzed the company and found it to be a good investment opportunity. However, upon comparative analysis with peers, the author discovered that the company's valuation is higher than its peers, indicating a potential overvaluation. The author suggests that investors should exercise caution and consider alternative investment options.

On Thursday, Tripadvisor Inc. (TRIP) saw its stock surge by 16.7%, marking the largest one-day gain in the company's history. This significant increase was attributed to the disclosure by activist investor Starboard Value of a substantial 9% stake in Tripadvisor, amounting to approximately $159.4 million based on the closing price of $14.99 per share on Wednesday [1].

Starboard Value's position in Tripadvisor is notable as it makes the activist investor the third-largest shareholder, following BlackRock Fund Advisors and the Vanguard Group. This investment comes after the activist firm accumulated shares during the second quarter, when Tripadvisor's average closing share price was around $13.36 [1].

The activist's interest in Tripadvisor is part of a series of investments by Starboard Value in various companies, including Oracle Corp. (ORCL), Pfizer Inc. (PFE), Salesforce Inc. (CRM), Kenvue Inc. (KVUE), and Autodesk Inc. (ADSK) [1].

Comparatively, Tripadvisor's stock valuation stands out among its peers. With a market capitalization of $2.3 billion, it is significantly smaller than Expedia Group Inc. (EXPE) ($22.6 billion), Airbnb Inc. (ABNB) ($85.9 billion), and Booking Holdings Inc. (BKNG) ($186.7 billion) [1]. However, Tripadvisor's stock is the cheapest based on its price-to-sales ratio of 1.1, compared to Expedia's 1.5, Airbnb's 6.8, and Booking Holdings' 7.0 [1].

Analyzing the expected compound annual growth rates (CAGR) for revenue from 2025 through 2027, Tripadvisor has the lowest projected two-year sales CAGR of 7.3%, while Airbnb leads with 9.6%, Booking Holdings at 8.6%, and Expedia at 6.8% [1].

Investors should also consider the consensus ratings and price targets. Tripadvisor has a "buy" rating from 25% of analysts, a "neutral" rating from 50%, and a "sell" rating from 25%, with a consensus price target of $16.77, implying a 12% upside potential [1]. In contrast, Booking Holdings has a "buy" rating from 69%, a "neutral" rating from 31%, and a "sell" rating from 0%, with a consensus price target of $5,605.79, suggesting a 2% downside [1].

References:
[1] https://www.morningstar.com/news/marketwatch/20250703219/these-stocks-got-a-boost-as-starboard-value-took-a-big-stake-in-tripadvisor