Will Booking Holdings Inc’s (NASDAQ:BKNG) Earnings Grow In The Next 12 Months?
Based on Booking Holdings Inc’s (NASDAQ:BKNG) earnings update in December 2017, analysts seem highly optimistic, as a 73.61% rise in profits is expected in the upcoming year, against the past 5-year average growth rate of 15.38%. With net income at current levels of US$2.34B, we should see this rise to US$4.06B in 2019. I will provide a brief commentary around the figures and analyst expectations in the near term. Investors wanting to learn more about other aspects of the company should research its fundamentals here. Check out our latest analysis for Booking Holdings
How is Booking Holdings going to perform in the near future?
Over the next three years, it seems the consensus view of the 28 analysts covering BKNG is skewed towards the positive sentiment. Since forecasting becomes more difficult further into the future, broker analysts generally project out to around three years. I’ve plotted out each year’s earnings expectations and inserted a line of best fit to calculate an annual growth rate from the slope in order to understand the overall trajectory of BKNG’s earnings growth over these next few years.
By 2021, BKNG’s earnings should reach US$5.25B, from current levels of US$2.34B, resulting in an annual growth rate of 19.08%. This leads to an EPS of $109.23 in the final year of projections relative to the current EPS of $47.78. The main reason for growth is a result of reduction in costs rather than purely top-line expansion as earnings is increasing at a faster rate. Margins is currently sitting at 18.46%, which is expected to expand to 27.93% by 2021.
Next Steps:
Future outlook is only one aspect when you’re building an investment case for a stock. For Booking Holdings, I’ve compiled three pertinent aspects you should further examine:
Financial Health: Does it have a healthy balance sheet? Take a look at our free balance sheet analysis with six simple checks on key factors like leverage and risk.
Valuation: What is Booking Holdings worth today? Is the stock undervalued, even when its growth outlook is factored into its intrinsic value? The intrinsic value infographic in our free research report helps visualize whether Booking Holdings is currently mispriced by the market.
Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Booking Holdings? Explore our interactive list of stocks with large growth potential to get an idea of what else is out there you may be missing!
To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned.
