Is Booking Holdings, Inc. overvalued or undervalued?

As of 3 August 2023, the valuation grade for Booking Holdings, Inc. has moved from expensive to risky, indicating a shift in perception regarding its market position. The company is currently considered overvalued. Key ratios include a P/E ratio of 52, an EV to EBITDA of 35.95, and a PEG ratio of 1.75, which suggest that the stock is trading at a premium compared to its earnings growth potential.
In comparison to peers, Booking Holdings has a P/E of 48.64, which is higher than Airbnb, Inc. at 32.51 and Expedia Group, Inc. at 38.76, both of which are rated fairly valued. Additionally, while Booking's EV to EBITDA stands at 33.95, it is also higher than the industry average, reinforcing the notion of overvaluation. Notably, despite its recent stock performance showing a 33.70% return over the past year, which outpaces the S&P 500's 10.26%, the underlying financial metrics suggest caution for potential investors.