Booking Holdings recently reported strong earnings results for the year ending December 31, 2024, highlighting an increase in revenue and net income, along with a share buyback program announcement and dividend increase. Despite these positive financial indicators, the company's stock experienced an 8.93% decline last month. This period coincided with broader market volatility caused by increased tariffs announced by the Trump administration, which affected indices such as the Dow Jones, S&P 500, and Nasdaq, all of which showed a downturn. The travel sector, where Booking Holdings operates, was collectively under pressure as economic uncertainties impacted investor sentiment, contributing to the stock's performance. While the company exhibited robust financials, the external market conditions and tariff concerns likely played a role in shaping its on-market total returns, which reflected broader investor apprehensions amid a challenging economic backdrop.

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Over the last five years, Booking Holdings' shares have achieved a total return of 248.90%. This impressive growth is underpinned by several key developments. The company's earnings have consistently grown, averaging a significant 26.7% annually. Additionally, its shares were considered undervalued, trading substantially below estimates of fair value. A strategic series of share buybacks totaling 10.59%, amounting to US$12.31 billion, likely supported investor confidence, enhancing the stock's performance. Furthermore, strong earnings growth, particularly in the past year, saw profits rise at a rate outpacing the broader hospitality industry.

Booking Holdings has also excelled relative to both the broader U.S. market and the hospitality industry over the past year, bolstered by sustained earnings improvements. Noteworthy earnings reports, including a full-year revenue of US$23.74 billion in 2024, helped drive the stock’s long-term return, placing it ahead of major market indices in recent periods. Dividend increases have further added to the total shareholder returns, rewarding long-term investors amid a backdrop of economic fluctuations.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Companies discussed in this article include NasdaqGS:BKNG.

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