Booking Holdings Shareholders Should Brace For Volatility

Coming off of its strongest year since inception, Airbnb Inc ABNB is widening its lead on the competition. Airbnb co-founder and CEO Brian Chesky is playing a big role, marketing the platform's long-term stay potential by jumping from home to home, living on Airbnb properties. 

Competitor Booking Holdings Inc BKNG doesn't have that same luxury, according to a Wall Street Journal report. The company is spending heavily on marketing and diversification efforts. Booking CEO Glenn Fogel is making longer-term strategic investments, but the report suggests it's going to take a while to play out. 

See Also: Looking At Booking Holdings's Recent Whale Trades

Although the company is trying to ramp up its U.S. business, 87% of Booking's revenue was generated outside the U.S. last year. 

The European travel market has been hit with COVID-19 variants and rising geopolitical tensions. Russia’s travel restrictions are expected to have a significant impact on the travel industry and Booking looks the most vulnerable. 

At about 7.8 times sales, Booking appears discounted to Airbnb, trading at about 15 times sales, according to data from Benzinga Pro. However, rival Expedia Group Inc EXPE is trading at just 3.2 times sales.

Although Europe, the Middle East and Africa represented 31% of Airbnb's gross booking value in 2021, Booking's high international exposure is something investors want to avoid ... for now. The report suggests that those thinking about buying Booking shares should wait. 

ABNB, BKNG Price Action: At publication time, Airbnb was up 2.13% at $154.20 and Booking was up 3.96% at $2,153.99.

Photo: JoshuaWoroniecki from Pixabay.