After the publication of my bullish article on Booking (NASDAQ:BKNG) in late June, the company’s shares appreciated by more than 10% and there’s every reason to believe that they’ll increase in value in the next few months. While it will take years for the travel industry to return to its pre-COVID-19 levels, Booking has more than $10 billion in cash, which will help it to survive the pandemics. Already in Q2, the company reported positive GAAP EPS for Q2 thanks to a more than $800 million return from its equity investments. With an established foothold in the OTA field, Booking will be able to thrive and gain more market share in a post-pandemic world, since not every travel-related company will survive the current crisis. For that reason, I continue to hold a long position in Booking and believe that the company is one of the best travel stocks to own on the market right now.
Prepare For a Slow But Steady Recovery
Booking's stock is now more than 10% up since the publication of my latest article and it has every reason to continue to appreciate in the near-term. As a dominant OTA with a diversified portfolio of businesses, Booking is able to generate revenues by taking fees and commissions from each booking and reservation that is made on its platforms. Thanks to the growth of its platforms like Booking.com, Kayak, Priceline, Agoda, and others, Booking was able to achieve more than 20% ROIC in recent years until the pandemic started. While it will be a tough recovery for Booking and it will take time, the company has emerged stronger from the previous black swan events like 9/11, SARS outbreak, ZIKA epidemic, H1N1 pandemic, and others, and this time shouldn’t be any different.
It’s not a surprise that Booking had
