What happened

Shares of Booking Holdings (NASDAQ:BKNG) were moving higher last month as the online travel agency benefited from an improving outlook for the travel sector, buoyed by the accelerated vaccine rollout and as investors looked forward to the company's fourth-quarter earnings report. The stock actually pulled back modestly when the report came out, but that only put a minor dent in the month's gains.

According to data from S&P Global Market Intelligence, shares finished the month up 20%.

A woman watching a plane take off from an airport gate

Image source: Getty Images.

As you can see from the chart below, the stock gained steadily over the course of the month.

BKNG Chart

BKNG data by YCharts

So what

All of the major online travel agency stocks, including ExpediaTripAdvisor, and Trivago, finished the month up significantly, and all three of those stocks actually outperformed Booking.

Though the travel industry is still getting crushed by the pandemic, there are signs in some parts of the world of a strong rebound once the pandemic ends. In China, which brought the coronavirus pandemic largely under control by the spring, the number of air passengers in 2020 passed the 2019 total by September of last year, as travelers turned to domestic trips with international travel off limits. A similar pattern also seems to be taking place in Australia, which nearly eliminated the virus. 

Booking gained for seven straight sessions heading into its fourth-quarter earnings report, but fell 7% on Feb. 25 when the report came out. The company beat estimates even as revenue declined 63% to $1.2 billion, and Booking was able to limit its adjusted net loss to $23 million as it scaled back sharply on marketing spending. Even though the results beat estimates and management expressed optimism about the travel recovery, the stock still pulled back in part because it had run up so high in the lead-up to the report. Despite the sell-off, a number of Wall Street analysts raised their price targets on Booking stock in the aftermath of the report, signaling approval.

Now what

On the earnings call, CEO Glenn Fogel noted that bookings in Israel, which has vaccinated more than half of its people, are now up more than double digits from 2019 levels, indicating a strong rebound and portending pent-up demand in other markets as more people get vaccinated.

The company declined to offer guidance, given the uncertainty, but with vaccines now expected to be widely available in the U.S. by May, Booking could be looking at its best summer season ever.

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