Overview
BMO Capital Markets has increased its price target for Booking Holdings to $6,200 from $6,000 while maintaining an Outperform rating on the shares. That target sits well above the company’s most recent trading level of $4,270. Data referenced from InvestingPro show analyst targets spanning a wide range, from $4,495 up to $7,656, and indicate that the stock is trading below InvestingPro’s Fair Value model despite a year-to-date decline of 20.3 percent.
Quarterly performance and margins
Booking Holdings delivered solid fourth-quarter 2025 results, with bookings and adjusted EBITDA coming in ahead of Street expectations by 3 percent and 4 percent, respectively. Demand was described as healthy across all regions. The company reported an impressive gross profit margin of 87 percent and generated $9.8 billion in EBITDA over the last twelve months, which together reflect strong operating performance.
On the earnings front, adjusted earnings per share for the fourth quarter were $48.80, beating analyst estimates by $0.61. Revenue for the quarter reached $6.35 billion, above the expected $6.12 billion. The company reported a 9 percent increase in room nights and gross bookings rose 16 percent year-over-year to $43 billion - roughly an 11 percent increase on a constant currency basis. Overall revenue was up 16 percent versus the prior year, a gain helped by favorable currency movements.
Guidance and planned investments
Booking Holdings provided first-quarter 2026 and full-year 2026 guidance that exceeded consensus on the top line, but guidance missed Street expectations on margins. Management outlined plans to invest an additional $700 million in strategic initiatives. Those earmarked funds are intended to support developments in GenAI capabilities, progress toward the company’s Connected Trip vision, and expansion efforts in Asia and the U.S. Management said these investments will be partially offset by efficiency measures and savings from the company’s Transformation Program.
BMO adjusted its model in response to the results by raising its gross bookings estimates for 2026 and 2027, while only slightly increasing adjusted EBITDA projections. The modest move in EBITDA forecasts reflects the tension between revenue strength and the additional incremental spending that is expected to weigh on margins.
Analyst reactions and market sentiment
Following the quarterly release, analyst responses were mixed. Cantor Fitzgerald lowered its price target for Booking Holdings to $4,495 from $5,830 and kept a Neutral rating, citing concerns related to AI. Citizens reiterated a Market Perform rating and highlighted the company’s significant exposure to independent and boutique hotels as a mitigating factor against potential AI-driven disruption. These differing positions illustrate the varied views among analysts about how technological developments and spending will influence Booking Holdings’ future performance.
Company profile
Booking Holdings (NASDAQ: BKNG) operates online travel and restaurant reservation services.
Bottom line
BMO’s higher price target follows a quarter of outperformance on bookings and adjusted EBITDA, and the company’s reported margins and LTM EBITDA underscore strong operating results. However, planned strategic investments and guidance below Street margin expectations have kept analyst sentiment mixed.