In this article, we will take a look into Booking Holdings Inc’s (BKNG, Financial) DCF analysis, a reliable and data-driven approach to estimating its intrinsic value. Instead of using future free cash flow as in the traditional DCF model, the GuruFocus DCF calculator uses EPS without NRI as the default for the DCF model based on research that shows that historically stock prices have been more correlated with earnings than free cash flow.
As of 2024-11-19, Booking Holdings Inc’s intrinsic value as calculated by the Discounted Earnings model is $2056.30. It’s currently trading at a price of $5017.78. Therefore, the margin of safety based on the DCF model is -144.02%. The company is significantly overvalued.
The model
The GuruFocus DCF calculator follows a two-stage model by default. This model consists of the Growth Stage and the Terminal Stage. In the growth stage, the company is experiencing faster growth, while in the terminal stage, a lower growth rate is applied because…
