Booking Holdings stock rating downgraded by Wedbush amid valuation concerns

Investing.com - Wedbush downgraded Booking Holdings (NASDAQ:BKNG) from Outperform to Neutral on Wednesday, while maintaining its price target of $5,900.00. The company, currently valued at $182.9 billion, has seen its stock surge over 51% in the past year, trading near its 52-week high of $5,839.41.

The rating change follows several consecutive quarters of results that outperformed expectations, which had driven an expansion in the company’s valuation multiple, according to Wedbush.

The research firm acknowledged Booking’s management team has demonstrated a successful track record of execution across key initiatives to drive growth and maintain market leadership during this period.

Wedbush expressed caution about the company’s ability to deliver sufficient upside in coming quarters to justify the current premium valuation, citing ongoing macro uncertainty and minimal visibility into consumer trends.

The firm recommended investors reduce allocation to the broader online travel group, stating it would "continue to monitor for changes in the demand environment and the impact on 2H performance."

In other recent news, Booking Holdings has reported strong second-quarter results, showcasing a 7.7% increase in room nights. Despite a 1% decline in average daily rates, the company delivered impressive revenue and profit figures, leading several analyst firms to adjust their price targets. TD Cowen raised its price target to $6,850, citing margin upside and a clearer trend picture, while maintaining a Buy rating. Benchmark also increased its target to $6,200, noting strong growth and raised full-year guidance, despite a softer third-quarter room-night outlook. RBC Capital adjusted its price target to $6,100, highlighting Booking’s category leadership and capital return program as key factors for its positive outlook. BMO Capital raised its target to $6,000, attributing the increase to strong demand in Asia and Europe and favorable foreign exchange conditions. Piper Sandler set its target at $5,750, acknowledging Booking’s performance exceeding guidance, aligned with improved macroeconomic conditions. These developments reflect the company’s robust performance and optimistic analyst assessments.

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