One-glance verdict
Undervalued
$317.20 our estimate vs market $178.07
Wall Street consensus: $172.17 (-45.7% lower than our fair-value estimate)
44% below our estimate, below the bear case
Fundamentals snapshot
Airbnb, Inc.
ABNB · NMS · Consumer Cyclical · Travel Services
Current price
$178.07
52-week range
$110.81 - $178.48
Market cap
$106.63B
Balance sheet
Healthy
30.65x Strong cushion
Net cash $9.57B. Interest coverage shows how many times profit covers the interest bill.
What stands out
3 Rewards
1 Risk
3 rewards · 1 risks
- Reward Revenue grew 7.5% last year.
- Reward Returns 34.5% on equity, ahead of 33% of its peers.
- Reward Free cash flow was positive in 4/10 years.
- Risk Operating margin compressed from 22.5% to 21.0% over 3 years.
What this company does
Airbnb, Inc.
Airbnb runs a website and app that connects people renting out their homes or offering local activities (hosts) with travelers looking for a place to stay (guests). The company makes money by charging a service fee on every booking, so its revenue (the total money it brings in from sales) depends on how many people use its platform. Because Airbnb doesn't own the properties itself, it has lower costs than a hotel chain, which can lead to higher profit margins (the portion of each dollar in sales that the company keeps as profit).
How the company got here
In 2007, two roommates in San Francisco, Brian Chesky and Joe Gebbia, couldn't afford their rent. They decided to turn their living room into a temporary lodging space for attendees of a local design conference, offering air mattresses and breakfast. This simple idea, born out of necessity, quickly grew into a website called AirBed & Breakfast, which was later shortened to Airbnb in 2009. After receiving crucial early funding and mentorship, the company expanded rapidly, transforming from a quirky idea into a global travel and hospitality giant. In December 2020, Airbnb became a publicly traded company, with its stock value surging on the first day of trading.
What it actually does
Airbnb operates an online marketplace that connects people who have a place to stay (hosts) with people who are looking for a place to stay (guests). Think of it as a platform where you can book a spare room, an entire apartment, or a unique home, like a treehouse or a castle, directly from the owner for a short period. The company doesn't own the properties listed; it acts as a middleman, making money by charging a service fee to both the guest and the host for each booking. Beyond just a place to sleep, Airbnb also allows you to book local activities and tours, called 'Experiences', and other in-stay services.
Stays
This is the core of Airbnb's business and what most people know it for. It allows individuals (hosts) to list their available properties—ranging from a single room to an entire house—for travelers (guests) to book for short-term stays. Hosts set the price, availability, and rules for their space, while guests can search for and book accommodations that fit their needs and budget. Airbnb makes money by charging a service fee from both the host (typically around 3-5%) and the guest (usually under 14.2%) on each booking. This segment is the primary driver of the company's revenue (the total amount of money a company brings in from its sales).
Experiences
This part of the business offers activities and tours designed and led by local hosts. Instead of just booking a place to stay, travelers can book unique things to do, like a cooking class, a guided hike, or a pottery workshop. This allows guests to have more authentic, local experiences during their travels. For this service, Airbnb charges a higher commission (a fee for its services), typically around 20%, from the host of the experience. While smaller than the Stays business, it's a way for the company to get more business from each traveler's trip.
What management is betting on now
Airbnb's leadership is focused on making hosting more common and improving the quality and affordability of its core service. They are also concentrating on expanding into international markets where they see more room for growth. A key part of their strategy is to move 'beyond the core' of just stays and experiences by exploring new areas like long-term rentals and other travel-related services. The company is also investing in technology, such as artificial intelligence, to personalize the user experience and make it easier for guests to find what they are looking for.
Price history
How the share price has moved
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Earnings history
Last 8 quarters — what happened
Click any quarter to read the call summary and what the numbers say.
Revenue
$3.61B
Net income
$816.00M
Diluted EPS
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Operating cash flow
$1.27B
Free cash flow
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Sources
Revenue
$2.68B
Net income
$160.00M
Diluted EPS
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Operating cash flow
$1.71B
Free cash flow
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Revenue
$2.78B
Net income
$341.00M
Diluted EPS
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Operating cash flow
$526.00M
Free cash flow
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Revenue
$4.09B
Net income
$1.37B
Diluted EPS
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Operating cash flow
$1.36B
Free cash flow
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Revenue
$3.10B
Net income
$642.00M
Diluted EPS
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Operating cash flow
$975.00M
Free cash flow
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Revenue
$2.27B
Net income
$154.00M
Diluted EPS
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Operating cash flow
$1.79B
Free cash flow
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Revenue
$2.48B
Net income
$461.00M
Diluted EPS
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Operating cash flow
$466.00M
Free cash flow
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Revenue
$3.73B
Net income
$1.37B
Diluted EPS
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Operating cash flow
$1.08B
Free cash flow
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Is it cheap or expensive?
Fair value $317.20 vs current price $178.07
Wall Street consensus is the average analyst price target: $172.17 (-45.7% lower than our fair-value estimate).
Our most-likely fair value is $317.20 a share — about 78.1% above today's price of $178.07, so the stock currently looks cheap (undervalued).
Is it drowning in debt?
Healthy
Net cash $9.6B - more cash than debt. Interest coverage 30.7x.
Net debt
$-9.57B
Interest coverage
30.65x
Airbnb, Inc.'s profit covers its interest bill about 30.7 times over. which is stronger than every peer shown here.
Healthy
Worse cushion
Baseline
Better cushion
ABNB
BASELINE
Airbnb, Inc.
Total debt $2.50B Interest coverage 30.65x This is the baseline the peer rows are being compared against.
Total debt $20.92B Interest coverage 5.74x -81% vs ABNB Carries about 5.3x less debt cushion than ABNB.
Total debt $5.69B Interest coverage 7.23x -76% vs ABNB Carries about 4.2x less debt cushion than ABNB.
Total debt $17.77B Interest coverage 5.12x -83% vs ABNB Carries about 6.0x less debt cushion than ABNB.
Total debt $14.02B Interest coverage 4.34x -86% vs ABNB Carries about 7.1x less debt cushion than ABNB.
Total debt $4.65B Interest coverage 20.16x -34% vs ABNB Carries about 1.5x less debt cushion than ABNB.
What you should know
The case for and against ABNB
3 Rewards
1 Risk
Rewards
-
Revenue grew 7.5% last year.
-
Returns 34.5% on equity, ahead of 33% of its peers.
-
Free cash flow was positive in 4/10 years.
Risks
-
Operating margin compressed from 22.5% to 21.0% over 3 years.
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
40.66x
Forward P/E
29.07x
P/B
13.47x
P/S
8.10x
EV/EBITDA
34.56x
PEG ratio
1.65x
Profitability
How much profit each dollar creates
Gross margin
82.9%
Operating margin
21.0%
Net margin
20.4%
ROE
34.5%
ROA
6.1%
Health
Liquidity and balance-sheet strength
Debt / equity
0.32x
Current ratio
1.41x
Quick ratio
0.68x
Total debt
$2.50B
Total cash
$12.07B
Growth
How the business has been compounding
Revenue TTM
$13.16B
Revenue 5Y CAGR
19.6%
EPS TTM
4.38
EPS 5Y CAGR
-28.3%
Cash flow
How much cash the business throws off
Operating CF TTM
$4.86B
Free CF TTM
$4.65B
FCF margin
35.3%
Dividend
Shareholder payout
Yield
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Payout ratio
0.0%
Last ex-div date
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