Booking Holdings Inc. EBITDA dropped on 99.7% and EBITDA Margin dropped on 39.5 pp from 39.8% to 0.28%
02/24/2021 • About Booking Holdings Inc. (
$BKNG) • By InTwits
Booking Holdings Inc. reported 2020 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Booking Holdings Inc. is a company in decline: 2020 revenue growth was -54.9%, 5 years revenue CAGR was -5.9%
- EBITDA Margin is quite volatile: 0.3% in 2020, 39.8% in 2019, 39.7% in 2018, 38.6% in 2017, 29.9% in 2016
- Booking Holdings Inc. has low CAPEX intensity: 5 year average CAPEX/Revenue was 2.8%. At the same time it's a lot of higher than industry average of 280.1%.
- CAPEX is quite volatile: $3m in 2020, $4m in 2019, $13m in 2018, $35m in 2017, $7m in 2016
- The company has unprofitable business model: ROIC is -3.7%
- It operates with high leverage: Net Debt/EBITDA is 104.1x while industry average is 52.6x
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
The company's Revenue dropped on 54.9%. Revenue decline showed acceleration in 20Q4 - it was 62.9% YoY. During 2016-2020 Revenue growth topped in 2017 at 18.0% and was decelerating since that time. Revenue decline was worsened by EBITDA margin decline. EBITDA Margin dropped on 39.5 pp from 39.8% to 0.28% in 2020. During 2016-2020 EBITDA Margin topped in 2019 at 39.8%.
SG&A as a % of Revenue increased on 6.0 pp from 34.6% to 40.6% in 2020.
Net Income margin dropped on 31.4 pp from 32.3% to 0.87% in 2020.
Investments (CAPEX, working capital and M&A)
Booking Holdings Inc.'s CAPEX/Revenue was 4.2% in 2020. Booking Holdings Inc.'s CAPEX/Revenue increased slightly on 1.9 pp from 2.3% in 2017 to 4.2% in 2020. For the last three years the average CAPEX/Revenue was 3.2%. Battling declining revenue the company made large investments to CAPEX (1,505% of EBITDA) but that didn't help at least in this year.
Return on investment
The company operates at negative ROIC (-3.7%) and low but positive ROE (1.1%). ROIC dropped on 35.6 pp from 32.0% to -3.7% in 2020. ROE dropped on 65.0 pp from 66.1% to 1.1% in 2020. During the last 5 years ROIC topped in 2019 at 32.0%.
Leverage (Debt)
Company's Net Debt / EBITDA is 104.1x and Debt / EBITDA is 659.9x. Net Debt / EBITDA surged on 103.6x from 0.5x to 104.1x in 2020. Debt jumped on 35.5% while cash jumped on 67.3%. During 2016-2020 Net Debt/EBITDA bottomed in 2019 at 0.5x.
Booking Holdings Inc. has no short term refinancing risk: cash is higher than short term debt (923.3%).
Valuation and dividends
Booking Holdings Inc.'s trades at EV/EBITDA 4,893.5x and P/E 1,542.4x.
Management team
The company's CEO Glenn D Fogel has spent 4 years with the company. The company's CFO David I Goulden has spent 3 years with the company.
Financial and operational results
FY ended 12/31/2020
Booking Holdings Inc. ($BKNG) key annual financial indicators| mln. $ | 2016 | 2017 | 2018 | 2019 | 2020 | 2020/2019 |
|---|
P&L
|
|---|
| Revenue | 10,743 | 12,681 | 14,527 | 15,066 | 6,796 | -54.9% |
| Gross Profit | 10,315 | 12,439 | | | | |
| SG&A | 3,935 | 4,737 | 5,146 | 5,216 | 2,760 | -47.1% |
| EBITDA | 3,215 | 4,901 | 5,767 | 5,995 | 19 | -99.7% |
| Net Income | 2,135 | 2,341 | 3,998 | 4,865 | 59 | -98.8% |
Balance Sheet
|
|---|
| Cash | 2,081 | 2,542 | 2,624 | 6,312 | 10,562 | 67.3% |
| Short Term Debt | 968 | 711 | 0 | 1,149 | 1,144 | -0.4% |
| Long Term Debt | 6,171 | 8,810 | 8,649 | 8,102 | 11,395 | 40.6% |
Cash flow
|
|---|
| Capex | 220 | 288 | 442 | 368 | 286 | -22.3% |
Ratios
|
|---|
| Revenue growth | 16.5% | 18.0% | 14.6% | 3.7% | -54.9% | |
| EBITDA growth | -8.9% | 52.4% | 17.7% | 4.0% | -99.7% | |
|
|---|
| Gross Margin | 96.0% | 98.1% | | | | |
| EBITDA Margin | 29.9% | 38.6% | 39.7% | 39.8% | 0.3% | -39.5% |
| SG&A, % of revenue | 36.6% | 37.4% | 35.4% | 34.6% | 40.6% | 6.0% |
| Net Income Margin | 19.9% | 18.5% | 27.5% | 32.3% | 0.9% | -31.4% |
| CAPEX, % of revenue | 2.0% | 2.3% | 3.0% | 2.4% | 4.2% | 1.8% |
|
|---|
| ROIC | 17.3% | 23.2% | 27.3% | 32.0% | -3.7% | -35.6% |
| ROE | 22.9% | 22.2% | 39.9% | 66.1% | 1.1% | -65.0% |
| Net Debt/EBITDA | 1.6x | 1.4x | 1.0x | 0.5x | 104.1x | 103.6x |
Booking Holdings Inc. ($BKNG) key quoterly financial indicators
| mln. $ | 20Q1 | 20Q2 | 20Q3 | 20Q4 | | YoY change |
|---|
P&L
|
|---|
| Revenue | 2,288 | 630 | 2,640 | 1,238 | | -19.4% | -83.6% | -47.6% | -62.9% |
| EBITDA | -192 | -372 | 430 | -39 | | -126.8% | -127.2% | -83.0% | -102.9% |
| Net Income | -699 | 122 | 801 | -165 | | -191.4% | -87.5% | -58.9% | -114.1% |
Balance Sheet
|
|---|
| Cash | 6,363 | 10,404 | 11,197 | 10,562 | | 172.6% | 97.9% | 73.2% | 67.3% |
| Short Term Debt | 995 | 973 | 979 | 1,144 | | -11.2% | -13.8% | -13.6% | -0.4% |
| Long Term Debt | 7,991 | 11,050 | 11,230 | 11,395 | | -1.4% | 35.1% | 40.8% | 40.6% |
Ratios
|
|---|
| EBITDA Margin | -8.4% | -59.0% | 16.3% | -3.2% | | -33.6% | -94.5% | -34.0% | -43.1% |
| Net Income Margin | -30.6% | 19.4% | 30.3% | -13.3% | | -57.5% | -6.1% | -8.3% | -48.4% |
Peers in Internet & Direct Marketing Retail
Below we provide Booking Holdings Inc. benchmarking against other companies in Internet & Direct Marketing Retail industry for the last 5 years. We show data for the top-5 companies by key financial metric together with the median value for all the companies in the industry.
Top companies by Revenue growth, %
| Top | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Farfetch Limited ($FTCH) | - | 59.4% | 56.1% | 69.5% | 63.9% |
| Cango Inc. ($CANG) | - | 142.3% | 3.7% | 31.9% | 42.5% |
| Amazon.com, Inc. ($AMZN) | - | 30.8% | 30.9% | 20.5% | 37.6% |
| Stitch Fix, Inc. ($SFIX) | - | 33.8% | 25.5% | 28.6% | 8.5% |
| |
|---|
| Median (4 companies) | - | 46.6% | 28.2% | 30.3% | 40.1% |
|---|
| Booking Holdings Inc. ($BKNG) | - | 18.0% | 14.6% | 3.7% | -54.9% |
Top companies by Gross margin, %
| Top | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Cango Inc. ($CANG) | 60.8% | 63.3% | 60.2% | 62.6% | 46.5% |
| Farfetch Limited ($FTCH) | 48.3% | 53.1% | 49.5% | 45.0% | 46.1% |
| Stitch Fix, Inc. ($SFIX) | 44.3% | 44.5% | 43.7% | 44.6% | 44.1% |
| Amazon.com, Inc. ($AMZN) | 35.1% | 37.1% | 40.2% | 41.0% | 39.6% |
| |
|---|
| Median (4 companies) | 46.3% | 48.8% | 46.6% | 44.8% | 45.1% |
|---|
Top companies by EBITDA margin, %
| Top | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Amazon.com, Inc. ($AMZN) | 9.0% | 8.8% | 11.9% | 14.3% | 13.8% |
| Stitch Fix, Inc. ($SFIX) | 9.3% | 4.0% | 4.4% | 2.4% | -1.7% |
| Farfetch Limited ($FTCH) | -33.8% | -21.6% | -24.9% | -26.9% | -24.1% |
| |
|---|
| Median (3 companies) | 9.2% | 6.4% | 4.4% | 8.3% | -1.7% |
|---|
| Booking Holdings Inc. ($BKNG) | 29.9% | 38.6% | 39.7% | 39.8% | 0.3% |
Top companies by CAPEX/Revenue, %
| Top | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Amazon.com, Inc. ($AMZN) | 5.7% | 6.7% | 5.8% | 6.0% | 10.4% |
| Stitch Fix, Inc. ($SFIX) | 2.1% | 1.8% | 1.4% | 2.0% | 1.8% |
| Farfetch Limited ($FTCH) | 2.5% | 3.3% | 3.5% | 3.9% | 1.6% |
| |
|---|
| Median (3 companies) | 2.3% | 2.5% | 3.5% | 3.4% | 1.8% |
|---|
| Booking Holdings Inc. ($BKNG) | 2.0% | 2.3% | 3.0% | 2.4% | 4.2% |
Top companies by ROIC, %
| Top | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Amazon.com, Inc. ($AMZN) | 11.9% | 7.3% | 14.9% | 13.0% | 14.1% |
| Cango Inc. ($CANG) | - | 48.3% | 6.6% | 4.3% | 3.3% |
| Stitch Fix, Inc. ($SFIX) | - | 32.2% | 20.5% | 6.6% | -10.7% |
| Farfetch Limited ($FTCH) | - | -35.3% | -22.7% | -27.7% | -124.7% |
| |
|---|
| Median (4 companies) | 11.9% | 19.8% | 10.8% | 5.5% | -3.7% |
|---|
| Booking Holdings Inc. ($BKNG) | 17.3% | 23.2% | 27.3% | 32.0% | -3.7% |
Top companies by Net Debt / EBITDA
| Top | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Cango Inc. ($CANG) | 0.8x | -1.3x | - | 1.8x | - |
| Amazon.com, Inc. ($AMZN) | 0.1x | 1.5x | 0.6x | 1.0x | 1.1x |
| Stitch Fix, Inc. ($SFIX) | -1.3x | -2.8x | -5.6x | -4.5x | - |
| |
|---|
| Median (3 companies) | 0.1x | -1.3x | -2.5x | 1.0x | 1.1x |
|---|
| Booking Holdings Inc. ($BKNG) | 1.6x | 1.4x | 1.0x | 0.5x | 104.1x |
