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Booking Holdings shares jump after beating Wall Street's 3Q revenue estimates

Travel agency revenues made up the bulk of the online travel company's sales of $4.85bn
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Looking ahead, the Connecticut company expects its 4Q profits to fall between $880 million to $905 million

Shares of Booking Holdings Inc, formerly known as Priceline, (NASDAQ:BKNG) popped in Tuesday’s pre-market session after the online travel company beat Wall Street’s third-quarter revenue estimates as customers booked more travel services via its web sites.

In its latest quarter, the Norwalk, Connecticut-based company posted total revenue of $4.85 billion, which was up from $4.43 billion in the year-ago quarter and came in ahead of analysts’ forecast of $4.8 billion.  

Its net income, meanwhile, amounted to $1.8 billion or $37.02 per share. On an adjusted basis, its earnings came in at $37.78, which missed Wall Street’s forecast of $38.21 per share.

A Wedbush analyst weighs in

In a note to investors, Wedbush analyst James Hardiman said that while Booking delivered “slightly worse-than expected” current quarter trends, it painted a picture of more robust growth for the upcoming quarter.

“While the online travel industry is not without its competitive risks (Google being the most notable), we believe the industry benefits from a great many secular tailwinds, on which Booking is well-positioned to capitalize,” Hardiman and his team concluded.

“Booking’s scale … and geographical diversity … give the company inherent advantages,” he added. Wedbush is sticking to an Outperform rating and a $2,500 12-month price target on the stock.

Investors still welcomed the results and sent Booking shares up 6.9% to $2,000 after the closing bell on Monday.

READ: Priceline owner Booking Holdings tops 1Q estimates, but offers 2Q revenue outlook below analyst expectations

“Booking Holdings delivered solid growth and operating results during our seasonally busy third quarter," said Glenn Fogel, CEO of Booking Holdings in a statement. “Globally, our accommodation business reported a new milestone of more than 200 million room nights booked in a single quarter, which is up 13% over the same period last year.”

Agency revenues amounted to $3.54 billion while merchant revenues came in at $1.049 billion

Looking ahead, Booking expects its net income for the fourth quarter to fall between $880 million to $905 million, which is the per-share equivalent of $18.90 to $19.40

Contact Ellen Kelleher at [email protected]

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