Head-To-Head Review: Booking (NASDAQ:BKNG) vs. Groupon (NASDAQ:GRPN)

Booking (NASDAQ:BKNG) and Groupon (NASDAQ:GRPN) are both retail/wholesale companies, but which is the superior business? We will contrast the two companies based on the strength of their dividends, profitability, risk, valuation, institutional ownership, analyst recommendations and earnings.

Analyst Ratings

This is a summary of current recommendations and price targets for Booking and Groupon, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Booking	0	8	28	1	2.81
Groupon	2	1	2	0	2.00

Booking currently has a consensus target price of $227.05, indicating a potential upside of 26.53%. Groupon has a consensus target price of $19.50, indicating a potential downside of 30.23%. Given Booking’s stronger consensus rating and higher possible upside, analysts plainly believe Booking is more favorable than Groupon.

Profitability

This table compares Booking and Groupon’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Booking	22.23%	-117.14%	25.85%
Groupon	-20.78%	N/A	-16.40%

Risk and Volatility

Booking has a beta of 1.07, meaning that its stock price is 7% more volatile than the S&P 500. Comparatively, Groupon has a beta of 0.23, meaning that its stock price is 77% less volatile than the S&P 500.

Valuation and Earnings

This table compares Booking and Groupon”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Booking	$26.92 billion	5.17	$5.40 billion	$7.60	23.61
Groupon	$498.42 million	2.13	-$83.52 million	($2.61)	-10.71

Booking has higher revenue and earnings than Groupon. Groupon is trading at a lower price-to-earnings ratio than Booking, indicating that it is currently the more affordable of the two stocks.

Institutional & Insider Ownership

92.4% of Booking shares are held by institutional investors. Comparatively, 90.0% of Groupon shares are held by institutional investors. 0.2% of Booking shares are held by company insiders. Comparatively, 36.6% of Groupon shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Summary

Booking beats Groupon on 13 of the 15 factors compared between the two stocks.

About Booking

Booking Holdings Inc, formerly The Priceline Group Inc., is a provider of travel and restaurant online reservation and related services. The Company, through its online travel companies (OTCs), connects consumers wishing to make travel reservations with providers of travel services across the world. It offers consumers an array of accommodation reservations (including hotels, bed and breakfasts, hostels, apartments, vacation rentals and other properties) through its Booking.com, priceline.com and agoda.com brands. Its other brands include KAYAK, Rentalcars.com and OpenTable, Inc. (OpenTable). As of December 31, 2016, Booking.com offered accommodation reservation services for over 1,115,000 properties in over 220 countries and territories on its various Websites and in over 40 languages, which included over 568,000 vacation rental properties (updated property counts were available on the Booking.com Website).

About Groupon

Groupon, Inc., together with its subsidiaries, operates a marketplace that connects consumers to merchants. It operates in two segments, North America and International. The company sells goods or services on behalf of third-party merchants. It serves customers through its mobile applications and websites. The company was formerly known as ThePoint.com, Inc. and changed its name to Groupon, Inc. in October 2008. Groupon, Inc. was incorporated in 2008 and is headquartered in Chicago, Illinois.