QS Research · Michael Burry's Scion Capital analyst template · 2006
Booking Holdings Inc. (BKNG)
As of 2026-11-08 · 12/15 boxes filled from SEC filings and market data
Conclusion: WATCH
Conviction low · base case none · downside -10% · upside +10%
The market is treating the $900M FTC revenue reduction and Q4 deceleration as if BKNG's earnings power is impaired, but Q3 2026 adjusted revenue grew 9%, adjusted EBITDA 9% and adjusted EPS 17% (S31, S100). At the company's own 12.6x TTM EV/EBITDA, base value is $9.81B x 12.6 = $123.6B EV, less $4.25B net debt = $119.4B equity / 743.70M shares = about $160.5, roughly 0% versus $160.66 (N14, N24, N5, N1). A 10% lower EBITDA case is $8.83B x 12.6 = $111.2B EV, less $4.25B = $107.0B / 743.70M = about $144 (-10.4%), and a 10% higher case is $10.79B x 12.6 = $136.0B, less $4.25B = $131.7B / 743.70M = about $177 (+10.2%). That is not enough asymmetry for a long, and the AI/regulatory overhang is not a short at 16.6x P/E and 7.7% FCF yield, so watch.
Key numbers
- Share price: $160.66
- Market cap: $119.49B
- Latest financial period: TTM to Sep 30, 2026
- Revenue (TTM): $28.13B
- EV / EBITDA (TTM): 12.6x
- P/E (TTM): 16.6x
The 15 boxes
- ✓ 1. Long-form business notes
Booking Holdings makes money primarily by facilitating travel reservations, mostly accommodation, through five consumer brands; FY2025 revenue was $26.9B, split into merchant, agency, and advertising/other revenue models. The FY2020-to-FY2025 record shows revenue and operating cash flow scaling sharply, operating income turning positive, large buybacks, negative total equity, and a lower diluted share count. The business shifted from six primary brands in FY2020, including Rentalcars.com, to five in FY2025, while pushing Connected Trip, Gen AI, payments, and loyalty.
- ✓ 2. Competitive advantage
The record shows genuine scale economics — FY2025 revenue $26.92B, operating income $8.82B and operating cash flow $9.41B against capex of only $322M — but the 10-K describes the moat as thin and shrinking: "Barriers to entry are low", Google/Gemini and AI-native agents are named as competitors, a significant share of traffic is rented from third-party platforms, and regulators are cutting back the parity provisions and ranking discretion that historically protected the marketplace. Margins are real at the operating line, but FY2025 pre-tax and net income to common fell while operating income rose, and goodwill/intangible impairments sit in FY2025. Equity is negative (-$5.58B at 2025-12-31) after $6.44B of FY2025 buybacks, so equity-based return measures are not meaningful.
- ✓ 3. 10-Q takeaways
Q3 2026 (quarter ended 2026-09-30, 10-Q filed 2026-11-03) was an operating beat reported under a GAAP revenue decline: room nights +7% to 345M, gross bookings +9.6% to $54.5B, but total revenues fell 1.3% to $8.9B because a $900M FTC-related revenue reduction was booked in the quarter; adjusted revenue was $9.8B, +9%, adjusted EBITDA $4.6B, +9%, at a flat 47.0% margin, and GAAP net income was $2.7B, down 1%. Costs were mixed: marketing +10.6%, IT +25.2%, G&A +33% (FTC matter), personnel flat. Capital return stayed heavy ($2.1B repurchased in Q3, $12.4B authorization remaining, $0.42 dividend) and Q4 2026 guidance decelerates to 1-3% room night growth with roughly flat adjusted EBITDA.
- ✓ 4. Corporate governance
Filled; members read this box.
- ✓ 5. Overview of the prior 3 years of 8-K filings
Filled; members read this box.
- ✓ 6. Other significant filings
Filled; members read this box.
- ✓ 7. Chronology of significant news and events
Filled; members read this box.
- ✓ 8. Comparables valuation interpretation
Filled; members read this box.
- ✓ 9. Insider trading interpretation
Filled; members read this box.
- ○ 10. Earnings-call notes
- ○ 11. Impression of the shareholder letter
- ○ 12. Scuttlebutt overview
- ✓ 13. Valuation and risk/reward summary
Filled; members read this box.
- ✓ 14. Current price suppression and potential catalysts
Filled; members read this box.
- ✓ 15. Conclusions
The call above.
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