Booking Holdings (BKNG) reported third-quarter earnings that surpassed analyst expectations, with revenue of $9.01 billion against an expected $8.71 billion and an EPS of $99.50, beating the consensus estimate of $95.56. The company's revenue for the quarter was up 12.7% compared to the same period last year. Despite the positive top-and-bottom-line performance, the focus for investors has turned to the company's profitability. Net profit margins declined to 19.4% from 21.8% in the same quarter of the previous year, and annual EPS growth was nearly flat at 0.2%. This performance contrasts with the company’s strong five-year average annual EPS growth of 39%. Looking ahead, management has forecasted earnings growth of approximately 20% per year. However, the recent margin pressure and a high price-to-earnings ratio of 32.6x, which is above the industry average, are key points of discussion for investors weighing the company's growth prospects against its current valuation.
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