Booking stock forecast: can travel giant return from COVID?
Making a Booking stock forecast is hard. Will it capitalise on COVID restriction lifting?
Over the course of the COVID-19 pandemic, travel has been one of the worst-hit industries. With lockdown restrictions in place around the world, people have not been able to get away, whether for business or for a holiday. This has had a serious impact on the industry, and one of its biggest players, Booking Holdings, has been no exception. However, with restrictions starting to be lifted, things are looking better for the company. Despite that, though, the company still faces challenges, and things are not on an entirely uphill path for the Booking Holdings stock forecast just yet. There are still obstacles for the company to get around.
The company, which owns such brands as Booking.com, Priceline.com, Cheapflights and Rentalcars, took a hit to its stock price during 2020. It closed at $2,072.54 in 2019, but news of the coronavirus pandemic meant it plummeted to $1,177.43 on 20 March. It was able to turn itself around and, by the end of the year, it stood at $2,227.27 – higher than 12 months earlier. The story in 2021 has been a series of peaks and troughs, with a low of $1,886.19 on 27 January turning into a high of $2,443.50 on 24 February. This spike was followed by more ups and downs, with a low of $2,215 on 24 March followed by a high of $2,479.90 on 16 April, before a short-term drop to $2,345 on 20 April. Things improved again pretty quickly, hitting $2,505.10 on 28 April. However, there was still bad news in store, with an overall drop to $2,172.25 on 12 May. Since then, however, it has rallied slightly and closed on 14 May at $2,282.18. That represents a rise in the Booking Holdings stock price of just under 2.47% from the end of 2020, but a drop of nearly 8.9% in a little more than two weeks.
So, why the fluctuation in the BKNG stock price? To get some understanding, it’s worth looking at what happened to the company in the first three months of 2021.
Quarterly report: could be better
The report for the first quarter of 2021 made for somewhat depressing reading. Revenues were $1.1bn, down 50% year-on-year, while the company made a loss of $55m. However, that represented a significant turnaround from the previous year, when it lost $699m. There was better news when it came to marketable equity securities, with it scoring a net gain of $32m, compared to a $307m loss the previous year. There was still a loss per diluted share of $1.34, compared with a net loss per diluted common share of $17.01 in the first quarter of 2020. Gross travel bookings – the value of bookings for rooms, car rentals and air tickets – were $11.9bn, down 4% from the same period in 2020.
In a statement, Booking CEO Glenn Fogel said:
"We saw encouraging signs of improving booking trends in the first quarter that continued into April with notable strength in the US. While we expect there will be continued volatility in the recovery of global travel demand, our teams across Booking Holdings will continue their hard work to strengthen the positioning of our company and execute against our key strategic priorities."
Fogel also said he was in favour of vaccine passports if they would help people travel and open up the industry. He told CNBC:
“I’m not sure why people still object to it, in terms of making it safer for people to travel."
He also said it was important for vaccines to be rolled out as soon as possible, saying:
"The industry has been so devastated, travel’s been so hurt by this terrible, tragic crisis, and we need every single thing that can help get the travel industry going and is allowing people to travel, because the vaccines are absolutely proven to be safe."
What the experts say
Fogel’s sentiments are reflected in what experts think will happen to the company over the next 12 months. The average prediction for the company sees its value go up by 11.7% to $2,550. The most optimistic Booking stock forecast says it will go up by 29.2% over the next year, reaching $2,950. There is still some negativity in the predictions, with one forecast saying it will lose 17.2% of its value, going down to $1,890.
However, analysts are currently more cautious when it comes to making recommendations of what to do with BKNG stock. Of 33 people making recommendations, 18 say to hold. There are 13 analysts suggesting that now is a good time to buy, one who says it will outperform over the next year, and one saying it will underperform. No one is saying that now is a good time to sell, though, which could be interpreted as positive Booking Holdings stock news.
If we go forward a few years, the BKNG forecast is more positive. Wallet Investor, which has a pessimistic BKNG Holdings stock price forecast for the next 12 months, saying it will drop to $2,257.51, predicts it should go up slightly, reaching $2,394.24 in five years’ time. Gov.capital is incredibly optimistic, giving a BKNG stock forecast of anywhere between $12,681.44 and $17,157.241 for 17 May 2026.
This would suggest that things could go well for Booking Holdings, but we still have to see how the travel industry – and the world at large – recovers from the impact of the COVID-19 pandemic.
Trade Booking Holdings Inc. - BKNG stock price
Is BKNG a buy or sell?
Things are still unclear about the BKNG forecast. While the situation appears to be moving in the right direction, it hasn’t got back to normal, and doesn't look like it will for some time yet. As we have seen, more people are suggesting investors hold on to their stock than do anything else. While there does not appear to be any instruction to sell, analysts seem to be suggesting caution. However, with the hope that the travel market can get back on its feet, some people think buying into Booking Holdings might be worth doing now rather than a while down the road. Always remember, though, that you should do your own research when it comes to investing.
Is Booking Holdings a good investment?
We have to see whether the travel industry is able to bounce back from the last year of restrictions and, if so, when and how quickly it does. The general analysis seems to be that it will, although things are not going to change overnight. One might think that Booking Holdings, as one of the US’s biggest travel companies, would be in a good position to take advantage of these changes, but things are still unsure at present.
How to buy BKNG stock
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