Booking Holdings Inc. (BKNG)

Has admired the company tremendously. They are very innovative. This is an example of how technology is transforming whole industries. People that don’t transform in this highly innovative environment are really going to struggle. This is a high multiple stock and has been growing very well. Has totally disrupted the travel industry. He worries that companies like Facebook (FB-Q), Apple (AAPL-Q) and Google (GOOG-Q) are going to increasingly be able to move into these kinds of things, particularly Facebook. Airbnb is also dramatically changing how the travel business works.

A high beta stock, which means it moves the market, so is relatively volatile. If you stay with it long term, it does very well. This is in the Internet space, but in the Internet travel space. They own Booking.com, Kayak and Open Table. Growing gross bookings in the high 20%. This is an opportunity because with the unfortunate events in Paris and terrorism on everybody’s mind, the fear is that travel will be a little more subdued. However, historically, drivers have a great propensity to take on greater risk to get what we want.

This is a funny one. A stock with a big share price which makes people think it is overvalued, but it actually scores really well on valuation. ROE is particularly strong at 30%. It is high in terms of value on PE to EBITDA, but there is no net debt. Has had strong price momentum, even with the recent volatility. They have been a consolidator for their business. From a price line this is one that you can hold here.

The chart, from early 2014 to now, is beginning to look like a cup. A cup is identified by having lower lows followed by higher lows. It looks like it tried to break out, but failed. As a technical person he wouldn’t buy this until it definitively broke the handle, somewhere around $1300. The formation is encouraging, but it is not yet ready to Buy.

This is probably a falling knife at this point. They came out with great earnings, weak guidance, so the stock fell. Not only was the guidance tepid, but anything trouble related is getting hit hard. Give it a few days at least. Overall it is a good company and probably something you can wade back into.

(A Top Pick Nov 3/14. Up 22.61%.) They are going to report on the 9^th and he thinks it will be a good report, especially based on what some of their peers are doing. Expects they will report somewhere around $57 a share for the year. Next year it will probably push $70.

The consumer is strengthening due to low oil prices and the first thing they are doing is spending more money on travel. Online is taking a larger and larger share of the revenue. This one has a dominant position in Europe. It has a growing piece of a pie in a growing market.

(Top Pick Sept. 11/14, Up 8.70%) 70% of revenues are from outside of the US, so it surprises him that it is up.

An online site for booking travel and they have hundreds of thousands of relationships with hotels globally. Last quarter they grew international bookings at 29% year-over-year. It is still growing extremely robustly. Currently trading at about 18X this year’s earnings. He is expecting $65 of earnings per share this year.

(A Top Pick April 30/14. Up 8.9%.) Last quarter was gangbusters. Came out with very, very strong numbers. Expects gross bookings and earnings to rise, somewhere in the high 20% area. Trading at below 20X earnings, so not expensive.

There is a clear trading channel, going down. This is looking negative. We had a strong run and then it stepped back.

Expecting $65 a share in earnings next year. Reporting tomorrow morning at 7 AM, and he expects good things. They are growing their gross bookings in the high 20% range.

Booking.com is one of their divisions. 600,000 booking per night around the world. Growing at 26% and trading at 23 times earnings. A virally expanding company.

The 1 year chart shows a nice consolidation. He suspects that this may just be taking a pause. The support of around $1200 is most definitely being held. Looks like a healthy consolidation within an uptrend. He would probably buy it on any significant pullback to the trendline.

Getting to a level where he is starting to feel a little less comfortable. It’s up around 20X earnings, which is stretching the valuation. Also, one of the areas that he would be concerned about would be the emergence of these virtual “rental by owner” properties, were people, looking for vacation, are looking for more of an established place to visit and stay in. Thinks there will be some competition on the vacationers’ side.