Is Booking Holdings, Inc. overvalued or undervalued?

As of 3 August 2023, the valuation grade for Booking Holdings, Inc. has moved from attractive to risky, indicating a shift in perception regarding its investment potential. The company appears to be overvalued, with a P/E ratio of 52, significantly higher than its peers such as Airbnb, Inc. with a P/E of 29.31, and Cintas Corp. at 54.99. Additionally, the EV to EBITDA ratio stands at 35.95, which also suggests a premium compared to the industry norms.
In terms of peer comparison, Booking Holdings, Inc. has a PEG ratio of 1.75, which is relatively high when compared to Airbnb's PEG of 0.00, indicating that its growth prospects may not justify its current valuation. Despite showing a strong 1-year return of 35.12% compared to the S&P 500's 17.14%, the company's recent performance has been lackluster over shorter periods, with a 1-week return of -1.00% and a 1-month return of -1.61%. This trend reinforces the notion that Booking Holdings, Inc. may be overvalued in the current market environment.