Could Booking Holdings Be a Millionaire-Maker Stock?

Booking Holdings (BKNG 0.53%) -- formerly Priceline Group -- has been a big winner for investors. Over the last decade, the stock is up nearly 1,500%. Although its growth is slowing down, there are plenty of reasons to believe this company can still make shareholders money.

The leader in online travel

When it comes to online accommodations and reservations, Booking Holdings is front and center. It was an early pioneer with its Priceline.com service, and has since expanded with other sites like Booking.com, Agoda, RentalCars.com, and KAYAK. In recent years, acquisitions like restaurant reservation service OpenTable and tour and activity site FareHarbor have helped the company enter new businesses related to its pure travel bread-and-butter. Building a one-stop destination for vacationers has helped it stave off its peers and new upstart competition.

Data sources: Yahoo! Finance and company quarterly results. *As of last funding round valuation in March 2017 and unofficial revenue reports.

One might expect slower-than-average sales growth from an industry titan, but that isn't the case here. Expedia's small spin-off Trivago has sputtered, with revenue growing 7% at year-end 2017 and contracting 3% to kick off 2018. Start-up Airbnb reportedly grew revenue over 50% last year, though the company is privately held and official numbers are not available. Plus, even though Airbnb has become the name synonymous with private room and home renting, Booking.com's inventory of unique places to stay outside of the traditional hotel industry is on par with or even bigger than Airbnb's.

Will Booking make you a millionaire?

The key to Booking Holding's continued success is that the online travel industry is still growing. While booking online is the rule rather than the exception in developed countries like the U.S., the transition to digital is just beginning in many developing markets. Most of Booking's business is overseas, putting it in prime position to capitalize on that trend.

Image source: Getty Images.

Related to that factor is global economic growth. As the financial well-being of people in developing countries improves, travel becomes a more regular part of their lives. Again, as the industry leader in these areas, Booking will continue to benefit.

Thus, while it expects its growth to slow from past years' numbers, management continues to believe it can deliver double-digit sales expansion. Booking's trailing-12-month price-to-free-cash-flow ratio is only 22.6, and its one-year forward P/E is 20.8, implying further bottom-line growth for the company in the immediate quarters ahead.

But will Booking Holdings make you filthy rich? With its best days of explosive growth probably behind it, likely not all on its own. However, that doesn't mean shares won't continue their upward march. Given it's in the driver's seat of the still fast-expanding online travel industry, this stock is worth owning.