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Is Booking Holdings (BKNG) A Smart Long-Term Buy?

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·3 min read
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RiverPark Funds, an investment management firm, published its “RiverPark Large Growth Fund” first quarter 2021 investor letter – a copy of which can be downloaded here. The RiverPark Large Growth Fund (the “Fund”) returned 2.5% for the first quarter, while its benchmarks, the S&P 500 Total Return Index (“S&P”) advanced 6.2%, the Russell 1000 Growth Total Return Index (“RLG”) returned 0.9%. In contrast, the Russell 1000 Value Total Return Index returned 11.2%. You can view the fund’s top 5 holdings to have a peek at their top bets for 2021.

RiverPark Large Growth Fund, in their Q1 2021 investor letter, mentioned Booking Holdings Inc. (NASDAQ: BKNG) and shared their insights on the company. Booking Holdings Inc. is a Norwalk, Connecticut-based travel technology company that currently has a $96.5 billion market capitalization. Since the beginning of the year, BKNG delivered a 5.17% return, extending its 12-month gains to 74.52%. As of April 19, 2021, the stock closed at $2,456.20 per share.

Here is what RiverPark Large Growth Fund has to say about Booking Holdings Inc. in their Q1 2021 investor letter:

"We bought back a position in Booking Holdings during the quarter. Booking is the world’s leader in online travel, operating in 200 countries with brands including Booking.com, priceline.com, agoda.com, Kayak, Rentalcars.com and OpenTable. The company has been a dominant on-line travel agency for more than a decade with a high margin business model (40% EBITDA margin for 2019) that requires limited capital expenditures, typically less than 3% of revenue, producing $4.5 billion free cash flow for 2019. This cash flow has been used for episodic acquisitions as well as to return cash to shareholders.

BKNG is well positioned in travel as the largest player in online lodging bookings and the second largest player in alternative accommodations. Like all travel companies, Booking was hit hard by the pandemic, but with its high international exposure, we expect the company’s recovery to be equally strong when travel returns."

Our calculations show that Booking Holdings Inc. (NASDAQ: BKNG) ranks 19th in our list of the 30 Most Popular Stocks Among Hedge Funds. As of the end of the fourth quarter of 2020, Booking Holdings Inc. was in 108 hedge fund portfolios, compared to 113 funds in the third quarter. BKNG delivered an 8.05% return in the past 3 months.

The top 10 stocks among hedge funds returned 231.2% between 2015 and 2020, and outperformed the S&P 500 Index ETFs by more than 126 percentage points. We know it sounds unbelievable. You have been dismissing our articles about top hedge fund stocks mostly because you were fed biased information by other media outlets about hedge funds’ poor performance. You could have doubled the size of your nest egg by investing in the top hedge fund stocks instead of dumb S&P 500 ETFs. Here you can watch our video about the top 5 hedge fund stocks right now. All of these stocks had positive returns in 2020.

At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, Federal Reserve has been creating trillions of dollars electronically to keep the interest rates near zero. We believe this will lead to inflation and boost real estate prices. So, we recommended this real estate stock to our monthly premium newsletter subscribers. We go through lists like the 15 best innovative stocks to buy to pick the next Tesla that will deliver a 10x return. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. You can subscribe to our free daily newsletter on our website:

Disclosure: None. This article is originally published at Insider Monkey.