Booking Holdings Inc. (NASDAQ:BKNG)

The valuation ratios exhibit a general trend of contraction and stabilization following a period of extreme volatility in early 2022. While multiple ratios showed an initial sharp decline, a subsequent recovery occurred throughout 2023 and 2024, followed by a downward trajectory leading into early 2026.

Price to Earnings (P/E)

A significant contraction is observed in the P/E ratio, which plummeted from 164.31 in March 2022 to a low of 18.68 by September 2023. This was followed by a period of fluctuation where the ratio peaked at 37.65 in June 2025, before trending downward again to reach 21.83 by March 2026.

Price to Operating Profit (P/OP)

The P/OP ratio followed a trajectory similar to the P/E ratio but with less extreme variance. After an initial decrease from 28.66 in March 2022 to 14.98 in September 2022, the ratio fluctuated between 15 and 23 for several years, ultimately ending the period at 14.87 in March 2026.

Price to Sales (P/S)

The P/S ratio declined from 6.83 in March 2022 to 4.31 by September 2022. A steady increase followed, with the ratio reaching a peak of 7.24 in June 2025. This growth reversed in the final quarters, with the ratio dropping to 4.85 by March 2026.

Price to Book Value (P/BV)

The P/BV ratio remained relatively stable near 19.0 during the first three quarters of 2022. However, a rapid escalation occurred in late 2022 and early 2023, with the ratio climbing to 32.84 in December 2022 and spiking to 89.53 by March 2023, prior to the cessation of available data for this metric.

The analysis of valuation metrics reveals a significant transition from a period of high speculative valuation to a phase of earnings-driven stability. The relationship between share price and earnings per share (EPS) indicates a strong recovery and subsequent growth phase, where the expansion of the bottom line has largely moderated the valuation multiple.

Price-to-Earnings (P/E) Ratio Trajectory

A dramatic contraction in the P/E ratio is observed during the first half of 2022, falling from a peak of 164.31 in March 2022 to 28.26 by September 2022. This sharp decline suggests a normalization process as earnings recovered from previous lows. Following this correction, the ratio largely stabilized, fluctuating between 18.68 and 31.09 through 2023 and 2024. A secondary peak occurred in June 2025 at 37.65, followed by a downward trend to 21.83 by March 2026, indicating a more conservative valuation of the stock relative to its earnings in the final period.

Earnings Per Share (EPS) Growth

EPS exhibits a consistent and strong upward trajectory over the observed period. Starting at 0.51 in March 2022, EPS grew to 7.94 by March 2026. This growth was characterized by rapid acceleration throughout 2022 and 2023. While minor fluctuations were noted—specifically a dip to 5.02 in December 2023 and 5.94 in June 2025—the overall trend remains positive, serving as the primary driver for the compression of the P/E ratio despite rising share prices.

Share Price Correlation

The share price demonstrated a general increase, rising from 84.13 in March 2022 to a peak of 223.63 in June 2025. The fact that the P/E ratio decreased while the share price increased for much of the timeline confirms that the share price growth was supported by fundamental earnings growth rather than mere multiple expansion. The decline in share price from 223.63 to 173.38 between June 2025 and March 2026, coupled with the P/E drop to 21.83, reflects a market correction in valuation despite the EPS continuing to rise to its period high of 7.94.

An analysis of the Price to Operating Profit (P/OP) ratio from March 31, 2022, to March 31, 2026, reveals a period of significant operational growth contrasted by market valuation volatility. While the underlying operating profitability followed a consistent upward trajectory, the valuation multiple fluctuated in response to share price movements.

Operating Profitability Trends

A consistent and monotonic increase in operating profit per share is observed throughout the analyzed period. Starting at 2.94 US$ in March 2022, the figure rose steadily to 11.66 US$ by March 2026. This represents a sustained expansion of core operational efficiency and profitability, independent of market price fluctuations.

Share Price Volatility

The share price exhibited substantial variance, characterized by a general upward trend followed by a late-period correction. After fluctuating between 71.13 US$ and 97.06 US$ in 2022, the price experienced a significant surge, peaking at 223.63 US$ in June 2025. However, a contraction occurred in the latter half of 2025, with the price retreating to 170.80 US$ by December 31, 2025, before stabilizing slightly at 173.38 US$ in early 2026.

P/OP Ratio Dynamics

The P/OP ratio began at a high of 28.66 in March 2022, followed by a sharp contraction to 14.98 by September 2022. For the majority of the period between 2023 and mid-2025, the ratio remained within a range of 15.07 to 22.96, indicating a period of relative valuation stability despite the rising share price, as operating profits grew in tandem. Toward the end of the period, the ratio declined again, reaching 14.87 by March 31, 2026.

Valuation Synthesis

The divergence between the steady growth of operating profit per share and the volatile movement of the share price suggests that the fluctuations in the P/OP ratio were driven primarily by market sentiment and price action rather than operational instability. The reduction of the ratio to 14.87 by the end of the period, despite record-high operating profits, indicates a compression in the valuation multiple relative to the company's operational earnings power.

The analysis of valuation ratios from March 2022 to March 2026 reveals a divergence between consistent fundamental revenue growth and volatile market pricing. While sales per share demonstrated a linear upward trajectory throughout the entire period, the Price-to-Sales (P/S) ratio experienced significant fluctuations driven primarily by share price volatility.

Sales per Share Performance

A consistent and uninterrupted increase in sales per share is observed, rising from 12.32 USD in March 2022 to 35.73 USD by March 2026. This steady growth suggests a strong and stable expansion of the revenue base relative to the share count over the analyzed timeframe.

Price-to-Sales (P/S) Ratio Trends

The P/S ratio exhibited three distinct phases. An initial contraction occurred through much of 2022, reaching a period low of 4.31 in September 2022. This was followed by a recovery and expansion phase that peaked at 7.24 in June 2025. Finally, a sharp compression is evident in the latter part of the period, with the ratio declining to 4.85 by March 2026.

Valuation Driver Analysis

The fluctuations in the P/S ratio are directly attributable to share price movements rather than revenue instability. The peak valuation in June 2025 coincided with the maximum share price of 223.63 USD. Conversely, the decline in the P/S ratio observed between June 2025 and March 2026 occurred despite continued growth in sales per share, indicating that the market valuation of the equity decreased more rapidly than the company's ability to generate revenue.

An analysis of the financial metrics reveals a stark divergence between market valuation and the underlying book value of the company. While the share price demonstrated significant growth over the observed period, the book value per share underwent a continuous decline, eventually becoming negative, which rendered the price-to-book value ratio inapplicable in later periods.

Share Price Movement

The share price exhibited a general upward trajectory, rising from 84.13 USD in March 2022 to a peak of 223.63 USD in June 2025. Despite some volatility, including a dip to 71.13 USD in September 2022 and a late-period correction to 173.38 USD by March 2026, the market valuation remained substantially higher than the levels seen at the start of the period.

Book Value Per Share (BVPS) Erosion

A consistent downward trend in book value per share is observed. Starting at 4.31 USD in March 2022, the BVPS declined steadily throughout 2022 and early 2023. The metric transitioned into negative territory in June 2023 (-0.75 USD) and continued to deteriorate, reaching a low of -11.26 USD by March 2026. This indicates a significant reduction in shareholders' equity relative to the number of shares outstanding.

Price-to-Book Value (P/BV) Ratio Volatility

The P/BV ratio showed extreme escalation during the period it remained positive. Between March 2022 and September 2022, the ratio remained relatively stable, fluctuating between 18.79 and 19.54. However, a sharp increase occurred in December 2022 (32.84), culminating in a peak of 89.53 in March 2023. This surge was driven by the simultaneous increase in share price and the rapid contraction of the book value per share.

Ratio Applicability

Calculation of the P/BV ratio ceased after March 2023. This cessation is a direct result of the book value per share falling below zero starting in June 2023, as the ratio loses its traditional analytical meaning when equity is negative.