Should You Hold Booking Holdings (BKNG)?

Core Insights - Wedgewood Partners' third-quarter 2025 investor letter indicates that AI stocks remain a prominent focus on Wall Street, with the Wedgewood Composite achieving a net return of 5.9%, underperforming compared to the S&P's 8.1% and the Russell 1000 Growth Index's 10.5% [1] Company Performance - Booking Holdings Inc. (NASDAQ:BKNG) reported a one-month return of -5.34% but has seen a 21.27% increase in share value over the past 52 weeks, closing at $5,230.59 with a market capitalization of $169.523 billion on October 22, 2025 [2] - The company experienced revenue growth of 16% and a 32% increase in earnings per share, driven by strong room night growth in its ex-U.S. markets [3] - Over 60% of Booking's bookings come from direct traffic to its booking.com app or website, allowing for reinvestment in advertising across various channels [3] Market Position and Strategy - Booking Holdings' strategy focuses on fragmented hotel suppliers in ex-U.S. markets, enabling it to achieve scale where competitors struggle [3] - The company's emphasis on generating attractive returns from advertising is a key driver of its success, which is expected to benefit shareholders regardless of the marketing channel [3] - Despite its potential, Booking Holdings is not among the top 30 most popular stocks among hedge funds, with a decrease in hedge fund portfolios holding the stock from 102 to 92 [4]