Airbnb – ABNB $145 Buy on declines around $125.
Solid long-term player, well entrenched, and has the virtuous cycle and network of being one of the largest players, with a large and wide choice of rentals and therefore attracting the largest number of travelers – perpetuating the network/cycle.
Had amazing revenue growth from $2.5Bn to $9.9Bn in 6 years through 2023 but has now come down to an estimated more sedate growth of 12% for the 3-5 years, but earnings should grow faster at 13-15% – it has matured and has good operating margins of 18-19%, this should improve. This is more of an earnings story now.
Has gone up 34% in the past year to $145, and with an earnings growth of only 12-14% the P/E multiple of 32 is high, more than two times the earnings growth – hence my preference for a dip for a better price. Unfortunately, with this raging market and because it is the largest player it deserves a premium, it might not happen. If you want to buy now and add more on declines that is not a bad strategy. I would think its still worth a 10-12% return in the next few years with the possibility of more upside.