Analysis of Investments
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Booking Holdings Inc. pages available for free this week:
- Income Statement
- Statement of Comprehensive Income
- Cash Flow Statement
- Analysis of Long-term (Investment) Activity Ratios
- DuPont Analysis: Disaggregation of ROE, ROA, and Net Profit Margin
- Net Profit Margin since 2005
- Return on Equity (ROE) since 2005
- Price to Operating Profit (P/OP) since 2005
- Analysis of Debt
- Aggregate Accruals
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Adjustment to Net Income (Loss): Mark to Market Available-for-sale Securities
Booking Holdings Inc., adjustment to net income
US$ in millions
| 12 months ended: | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|---|
| Net income (as reported) | ||||||
| Add: Net unrealized gains (losses) on available-for-sale securities | ||||||
| Net income (adjusted) |
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
- Net Income Trends
- The reported net income exhibited a marked upward trajectory over the five-year period. Starting at 59 million US dollars in 2020, the figure grew substantially to 1165 million US dollars in 2021. This positive momentum continued with reported net income reaching 3058 million in 2022, 4289 million in 2023, and 5882 million in 2024, indicating steady and notable growth annually.
- Adjusted Net Income Trends
- Adjusted net income mirrored the pattern observed in reported net income, with values consistently slightly higher. Beginning at 82 million US dollars in 2020, adjusted net income rose to 1196 million in 2021. It then increased to 3046 million in 2022, 4296 million in 2023, and 5885 million in 2024. This close alignment with reported net income suggests that adjustments have minimal impact on the overall profit trend, reinforcing the strength of underlying earnings.
- Comparative Insights
- The gap between reported and adjusted net income remained relatively constant and small throughout the period, indicating stable adjustments without significant volatility or large non-recurring items affecting net income. Both metrics track closely, underscoring the consistent and robust profitability progression.
Adjusted Profitability Ratios: Mark to Market Available-for-sale Securities (Summary)
Booking Holdings Inc., adjusted profitability ratios
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
The financial performance indicators demonstrate a consistent and substantial improvement over the observed periods, reflecting a strong upward trend in profitability and efficiency ratios.
- Net Profit Margin
- Both reported and adjusted net profit margins show a marked increase from 2020 through 2024. The reported net profit margin grows from 0.87% in 2020 to 24.78% in 2024, while the adjusted net profit margin follows a similar pattern, rising from 1.21% to 24.79% over the same period. This trend indicates enhanced profitability and effective cost management, with margins expanding significantly year-over-year.
- Return on Equity (ROE)
- The reported ROE shows a dramatic improvement from 1.21% in 2020 to an exceptionally high 109.92% in 2022, with adjusted ROE closely mirroring this rise, increasing from 1.68% to 109.49%. The data for 2023 and 2024 are not provided. Such high ROE values in 2022 suggest extraordinary returns on shareholders' equity, which could be influenced by factors such as leverage or one-time gains.
- Return on Assets (ROA)
- Both reported and adjusted ROA present a continuous upward trend from 2020 through 2024. Reported ROA increases from 0.27% to 21.23%, and adjusted ROA from 0.37% to 21.24%. This consistent growth reflects improving asset utilization and operational efficiency, indicating the company is generating increasingly higher returns from its asset base.
Overall, the data indicate significant enhancements in profitability, equity returns, and asset efficiency. The parallel trends between reported and adjusted figures affirm the reliability of these improvements. The exceptionally high ROE values in 2022 warrant further investigation to understand underlying factors. The continuation of these trends into 2023 and 2024, particularly in profitability and ROA, underscores strong financial health and robust operational performance.
Booking Holdings Inc., Profitability Ratios: Reported vs. Adjusted
Adjusted Net Profit Margin
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
2024 Calculations
1 Net profit margin = 100 × Net income ÷ Revenues
= 100 × ÷ =
2 Adjusted net profit margin = 100 × Adjusted net income ÷ Revenues
= 100 × ÷ =
The financial data demonstrates a consistent and substantial growth trend in both reported and adjusted net income over the five-year period. Starting from relatively modest figures in 2020, the net income surged dramatically by 2024. This growth pattern indicates effective operational performance and possibly expanding market share or successful cost management.
Specifically, the reported net income increased from $59 million in 2020 to $5,882 million in 2024, showing over a 99-fold increase. Adjusted net income followed a similar trajectory, rising from $82 million to $5,885 million within the same timeframe. The close alignment between reported and adjusted net incomes suggests limited discrepancies due to extraordinary items or accounting adjustments.
The net profit margins also exhibit a strong upward trend, reflecting improving profitability and efficiency. The reported net profit margin improved from 0.87% in 2020 to 24.78% in 2024. The adjusted net profit margin shows a similar improvement, moving from 1.21% to 24.79% over the same period. This significant enhancement in margins indicates that the company has been able to not only increase income but also enhance its cost structure or pricing power.
- Income Growth
- Both reported and adjusted net incomes show exponential growth, indicating robust earnings expansion.
- Profit Margin Improvement
- Net profit margins have increased markedly, demonstrating enhanced profitability and operational efficiency.
- Consistency Between Measures
- Reported and adjusted figures align closely, implying stable accounting practices and minimal adjustments impacting reported results.
Adjusted Return on Equity (ROE)
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
2024 Calculations
1 ROE = 100 × Net income ÷ Stockholders’ equity (deficit)
= 100 × ÷ =
2 Adjusted ROE = 100 × Adjusted net income ÷ Stockholders’ equity (deficit)
= 100 × ÷ =
The financial data reveals a significant upward trend in both reported and adjusted net income over the five-year period. Reported net income increased sharply from 59 million US dollars in 2020 to 5,882 million US dollars in 2024. Similarly, adjusted net income rose from 82 million US dollars in 2020 to 5,885 million US dollars in 2024, closely mirroring the reported net income figures throughout the years.
The reported Return on Equity (ROE) shows notable growth from 1.21% in 2020 to an exceptionally high 109.92% in 2022. Adjusted ROE follows a comparable pattern, rising from 1.68% in 2020 to 109.49% in 2022. However, data for ROE values are missing for the years 2023 and 2024, which limits the analysis of recent profitability trends concerning shareholders’ equity.
- Net Income Trends
- Both reported and adjusted net income exhibit strong and consistent growth over the examined period, with the most pronounced increases occurring between 2020 and 2024. The nearly parallel trajectories of these two metrics suggest limited discrepancies between reported results and investment adjustments, indicating stable earnings quality.
- Return on Equity (ROE) Trends
- The ROE metrics demonstrate a dramatic improvement from very low returns in 2020 to extremely high levels by 2022. This suggests a substantial increase in the efficiency of equity capital use or changes in equity structure during this timeframe. The absence of data for 2023 and 2024 masks whether this improvement trend was sustained or reversed.
- Data Consistency and Implications
- The close alignment between reported and adjusted net income and ROE underscores consistent accounting and adjustment practices over the analyzed period. The sharp rise in profitability and returns indicates enhanced operational performance or capitalization strategies, but the missing recent ROE data restricts full assessment of the latest financial health and shareholder value creation.
Adjusted Return on Assets (ROA)
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
2024 Calculations
1 ROA = 100 × Net income ÷ Total assets
= 100 × ÷ =
2 Adjusted ROA = 100 × Adjusted net income ÷ Total assets
= 100 × ÷ =
- Net Income Trends
- The reported net income exhibits a consistent and substantial upward trajectory from 59 million USD in 2020 to 5,882 million USD in 2024. This represents significant growth over the five-year span. The adjusted net income follows a similar pattern, increasing steadily from 82 million USD in 2020 to 5,885 million USD in 2024, closely aligning with the reported figures and indicating minimal adjustments impacting net income.
- Return on Assets (ROA) Trends
- Reported ROA has shown a significant improvement over the analyzed period. Starting from a very low base of 0.27% in 2020, it rises sharply to 21.23% by 2024. This enhancement suggests more efficient asset utilization leading to increased profitability. Adjusted ROA mirrors the reported ROA closely, increasing from 0.37% in 2020 to 21.24% in 2024, reinforcing the consistency between reported and adjusted performance metrics.
- Comparative Insights
- The close alignment between reported and adjusted net income and ROA values across all periods suggests that the adjustments made to financial data have minimal effect on the overall financial performance portrayal. The substantial growth in net income coupled with improving ROA indicates enhanced operational efficiency and profitability over time.
- Overall Pattern
- The data demonstrates a clear pattern of strong financial growth and improving returns on assets throughout the five-year period. Both profitability and asset efficiency have markedly improved, reflecting positively on management’s ability to generate higher earnings from assets employed.