Benchmark on Wednesday reduced its price target for Booking Holdings (NASDAQ: BKNG) to $5,600 from $6,400, while leaving its Buy rating unchanged. At the time of the firm's note the shares were trading at $3,949.22, a position more than 20% lower year-to-date and well beneath the 52-week high of $5,839.41.
The analyst decision to cut the target stems from valuation concerns even as Booking reported a strong fourth quarter. The company surprised the market with gross bookings that were $1 billion ahead of consensus and posted a 9% increase in room nights. Those metrics helped drive revenue and EBITDA results that outperformed expectations, supporting the view that underlying demand remained resilient.
Over the last twelve months Booking generated $10.11 billion in EBITDA and sustained an 87.36% gross profit margin, metrics Benchmark highlighted in assessing the company’s earnings power. Nonetheless, the firm pointed to unexpected marketing deleverage in the fourth quarter and noted that growth in alternative accommodations softened sequentially.
Guidance into the first quarter also raised questions: the company’s initial room-night outlook fell below street estimates, a development Benchmark found notable given competitor commentary that suggested stronger near-term trends. Technical indicators add another layer to the picture - the stock’s relative strength index suggests it is in oversold territory, which may present value for some investors even as the firm flags short-term headwinds.
In constructing its valuation, Benchmark applied a multiple of 15 times current-year EBITDA, consistent with the approach used for a comparable peer. The firm used EBITDA excluding stock-based compensation for the comparable analysis. Benchmark also noted that if initial 2026 guidance is released above street expectations, the shares could reach a fundamental bottom - trading at roughly 10 times estimated 2027 EBITDA under that scenario.
Corporate actions under way include a planned 25-to-1 stock split. Investors are weighing that move alongside the recent operating update and the range of analyst reactions to the quarter.
Other broker activity has been varied. BMO Capital raised its price target to $6,200, citing solid bookings and adjusted EBITDA that beat Street expectations. By contrast, a number of firms trimmed their targets: DA Davidson and TD Cowen lowered theirs to $6,000, Piper Sandler moved its target to $5,000, and Cantor Fitzgerald cut its target to $4,495.
The main point of divergence among analysts relates to uncertainty around artificial intelligence and its potential effect on long-term growth. DA Davidson and TD Cowen kept Buy ratings despite lowering targets. Piper Sandler and Cantor Fitzgerald maintained Neutral ratings even as they reduced their price targets.
Collectively, these updates reflect an ongoing market debate: strong near-term operating results and margin expansion versus valuation compression and evolving structural risks tied to technology developments.