Booking's (BKNG) Long-Term Growth Outlook Drives Upgrade from Morgan Stanley

Booking Holdings Inc. (NASDAQ:BKNG) is included among the 13 Most Promising Long-Term Stocks to Buy According to Hedge Funds.

On February 24, Morgan Stanley analyst Brian Nowak upgraded Booking Holdings Inc. (NASDAQ:BKNG) to Overweight from Equal Weight. He set a price target of $5,500, down from $6,150. In his research note, Nowak said that even as agentic tools evolve, Booking is likely to remain “a key driver of travel.” He added that the company is well-positioned to “own the customer,” gather “robust” traveler data, and use that information to support high-margin direct bookings. The firm noted that early agentic travel products are developing differently than expected. Even so, Morgan Stanley believes Booking and other online travel agencies will remain central to the travel ecosystem. The analyst said these platforms are likely to be “just as important in the agentic world as they have been in the past two decades.”

During the company’s Q4 2025 earnings call, President and CEO Glenn Fogel said Booking delivered another year of strong operational performance. He acknowledged volatility in global markets but said the company’s core fundamentals remained solid. Travel demand stayed resilient, supported by the scale and reach of its global platform. Fogel also highlighted progress in expanding AI-driven capabilities. He said the company continues to execute on its Connected Trip strategy, while maintaining focus on growth in key regions such as Asia and the U.S.

In the fourth quarter, room nights reached 285 million. This marked a 9% increase compared with the prior year and came in above the company’s expectations. Strong demand across major regions helped drive gross bookings and revenue up 16%. Adjusted EBITDA increased 19% to $2.2 billion, while adjusted earnings per share rose 17%.

Fogel also discussed the company’s Transformation Program, which began in November 2024. He said the initiative has already delivered about $550 million in annual cost savings. This result reached the high end of the company’s earlier targets.

Booking Holdings Inc. (NASDAQ:BKNG) provides online travel and restaurant reservation services. The company operates through five major brands: Booking.com, Priceline, Agoda, KAYAK, and OpenTable.

While we acknowledge the potential of BKNG as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

READ NEXT: 13 Best Strong Buy Dividend Stocks to Invest In and Goldman Sachs Dividend Stocks: Top 14 Stock Picks

Disclosure: None.  Follow Insider Monkey on Google News.