Booking Holdings Announces a Massive 25-for-1 Stock Split. Here's What Investors Need to Know

Online travel agency Booking Holdings (NASDAQ: BKNG) has long been one of the priciest stocks on the market. The parent company of Booking.com, Priceline, Kayak, and OpenTable, was trading for more than $4,200 per share as of the market close on Wednesday -- but that's all about to change.

In conjunction with its fourth-quarter financial report, Booking announced plans for its first-ever forward stock split. Here's what investors need to know.

Image source: Getty Images.

The specifics

After the market close on Wednesday, Booking announced that its board of directors had approved a massive 25-for-1 stock split. "The stock split will be effected through the filing of an amendment to the Company's Restated Certificate of Incorporation with the Delaware Secretary of State," according to a regulatory filing.

Shareholders of record as of Friday, March 6, 2026, will receive an additional 24 shares of stock for each share they own, with the distribution occurring after the market close on Thursday, April 2, 2026. The stock is expected to begin trading on a split-adjusted basis when the market opens on Monday, April 6.

Shareholders won't need to take any additional steps in order to receive newly minted shares. Brokerages and investment banks will handle the details behind the scenes, and the stock will be deposited directly into investors' accounts upon completion of the stock split.

Given the complex process, the additional shares may not be available immediately after market close on April 2. Timing may vary from brokerage to brokerage, and it could ultimately take several days for the changes to be made to investors' accounts.

What it means for investors

Stock splits have enjoyed a resurgence in recent years, fueled by robust stock price gains and investor enthusiasm for the process. It's important to note that stock splits are largely cosmetic and don't change the underlying value of the shares owned.

For example, rather than having one share of Booking Holdings stock worth about $3,900 (as of this writing), shareholders will have 25 shares worth $156 each ($156 x 25 = $3,900). Put another way, it doesn't matter if you have 10 $1 bills or one $10 bill; you still have the same amount of money to spend. Similarly, Booking Holdings shareholders will simply have a larger number of lower-priced shares.

There is an element of investor sentiment that comes into play. Excitement about stock splits has been shown to drive up the price of the shares leading into the split. Market watchers also suggest that lowering the share price may attract investors who were put off by the high sticker price.

Experts suggest that the strong underlying business and financial performance that led to the stock split will generally continue, driving additional gains. History shows that companies that complete stock splits generate stock price gains of 25%, on average, in the year following the announcement, compared with average increases of 12% for the S&P 500, according to data compiled by Bank of America analyst Jared Woodard.

That doesn't mean investors should buy Booking Holdings simply because of the stock split, but there are other reasons to be bullish.

Is the stock a buy?

Booking Holdings has a long history of outperforming the broader market, and its recent results help to illustrate why. Fourth-quarter revenue of $6.3 billion grew 16% year over year, while earnings per share of $44.22 climbed 38%. The results were driven higher by gross bookings that grew 16% and room nights that climbed 9%. Perhaps more importantly, operating cash flow of $1.5 billion and free cash flow $1.4 billion surged 107% and 120%, respectively.

The company also raised its dividend to $10.50 per share, a 9% increase compared to 2025. With a payout ratio of about 11%, there's still ample room for future increases.

The stock was down on Thursday following the financial report, as the company forecast constant currency gross booking growth of 8% at the midpoint of its guidance, down from 10% in 2025. This drove fears of a potential slowdown brewing in the travel industry.

On the bright side, Booking Holdings stock has fallen 32% from its peak, putting it squarely in bargain territory. The stock is currently selling for 25 times earnings, well below its three-year average multiple of 30. This is despite the fact that Wall Street is predicting revenue growth of 10% in 2026 and 8% in 2027.

To be clear, investors shouldn't buy shares solely because of the upcoming stock split. Rather, it's the company's long track record of performance and stellar execution that makes Booking Holdings stock a compelling choice.

Bank of America is an advertising partner of Motley Fool Money. Danny Vena, CPA has positions in Booking Holdings. The Motley Fool has positions in and recommends Booking Holdings. The Motley Fool has a disclosure policy.