Multiyear Travel Recovery Likely, Booking Holdings Analyst Says After Q2 Beat

Tanzeel Akhtar

Fri, Aug 7, 2020, 12:35 PM2 min read

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Booking Holdings (NASDAQ: BKNG) shares were trading higher on Friday after the company reported better-than-expected second-quarter EPS and sales results.

The Booking Holdings Analyst: Morgan Stanley analyst Brian Nowak maintained an Equal-Weight rating on the company with a price target raised from $1,560 to $1,900.

Morgan Stanley On Travel Numbers: The slope of the travel recovery remains uncertain with, July reported room nights down 45% year-over-year versus down 55% in June, Nowak said in a Friday note. (See his track record here.)

Booking discussed a plateauing or deterioration of new bookings trends in several countries, the analyst said.

"We continue to see the travel recovery being led by domestic travel as domestic room nights represented 70% plus of BKNG's newly booked room nights in [the second-quarter] July," he said.

View more earnings on BKNG

"Alternative accommodation adoption is also higher during this uncertain period as Booking.com alternative accommodations represented minus 40% of new gross bookings in the second-quarter."

Booking's Staff, Cost Cuts: Booking Holdings is managing the volatile environment through cost management, Nowak said.

The company has undertaken a headcount reduction across its brands that is expected to result in $350 million of annualized savings, representing a roughly 25% headcount reduction across the organization, the analyst said.

“We remind investors that on one hand this is positive for margins and earnings power, but on the other hand this speaks to the likely multi-year travel recovery.”

BKNG Price Action: Booking Holdings shares were trading up 0.59% at $1,762.20 at the time of publication Friday. The stock has a 52-week high of $2094 and a 52-week low of $1,107.28.

Latest Ratings for BKNG

Aug 2020	Morgan Stanley	Maintains	Equal-Weight
Aug 2020	Credit Suisse	Maintains	Outperform
Aug 2020	Needham	Maintains	Buy

View More Analyst Ratings for BKNG
View the Latest Analyst Ratings

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Multiyear Travel Recovery Likely, Booking Holdings Analyst Says After Q2 Beat

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