Down 32%, Booking Holdings Announces 25-to-1 Stock Split. Time to Buy?

Core Insights - Booking Holdings reported Q4 results that exceeded both revenue and earnings estimates, with revenue of $6.35 billion, a 16% year-over-year increase [1] - The company announced a 25-to-1 stock split, its first forward split in history, aimed at increasing liquidity and attracting retail investors [1] - Despite strong performance, the stock has declined 27% year-to-date and 32% from its 52-week high, leading to questions about its future outlook [1] Financial Performance - Gross bookings reached $43 billion, up 16% year-over-year, driven by favorable currency effects and strong demand for accommodations and flights [1] - Room nights grew 9%, marking the fourth consecutive quarter of acceleration, exceeding the company's guidance of 4% to 6% [1] - Adjusted EBITDA rose to $2.2 billion, with margins expanding to 34.6% from 33.8% a year ago, aided by $250 million in savings from a transformation program [1] Shareholder Returns - The quarterly dividend was raised by 9.4% to $10.50 per share, alongside $2.1 billion in stock buybacks, with $21.8 billion still authorized for future buybacks [1] - For the full year 2025, the company returned $8.2 billion to shareholders through buybacks and dividends [1] Guidance and Market Reaction - Guidance for 2026 includes projected Q1 revenue growth of 14% to 16% and full-year adjusted revenue growth in the low double digits [1] - Citi analysts reduced their price target from $6,500 to $6,250, citing market volatility and slightly weaker-than-expected earnings guidance [1] - The stock's decline post-announcement indicates investor skepticism despite the company's solid fundamentals [1]