Investing.com — Mizuho upgraded Booking Holdings to Outperform from Neutral in a note on Wednesday, arguing that recent weakness has created a compelling entry point because concerns about artificial intelligence reshaping online travel are overstated.
Analyst Lloyd Walmsley said the firm sees “AI-related fears as overblown,” citing several factors that suggest online travel agencies will remain competitive even as search evolves.
He noted that during the industry’s shift from general search to hotel meta-search in 2018, “OTAs actually gained share,” despite expectations that hotel chains would take more direct bookings.
Mizuho also expects that both Google and OpenAI will monetise AI using “an auction model,” allowing OTAs to outbid hotels for traffic.
The firm added that it remains “skeptical of on-platform booking,” pointing to the failures of Tripadvisor Instant Booking and Google’s discontinued “Book on Google.”
Mizuho believes Booking’s partnership with OpenAI and its status as a major Google customer further support the company’s ability to navigate AI-driven changes to search.
Even in a scenario where traffic shifts toward paid channels, Walmsley wrote that “early Gen-AI traffic costs … are cheaper than Google search.”
The broker highlighted what it called a “healthy financial profile,” including high-single-digit gross bookings growth, margin improvement supporting mid-teens EBITDA gains, and an expected 19% rise in adjusted earnings per share in 2026.
Strong governance also factored into the upgrade, with Mizuho stressing that Booking “pays out limited stock-based comp” and returns capital opportunistically.
Mizuho kept its $6,000 price target on BKNG. Walmsley concluded: “For those who missed the mid-November sell-off, we believe this presents another compelling opportunity.”
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