Airbnb (ABNB), mcap=$76bn, price $119 vs $95

– Airbnb – is a good long-term investment opportunity at 20x normalized earnings.
– Although loss-making currently, it’s a capital-light business with increasing margins and continued growth.
– Set to turn into a compounder when normalized profitability is reached.
– Expected operating margins of 28% (vs -20% currently) and a net margin of 20% to be reached within 5 years.

– Steady-state earnings of around $3.1 bn on revenues of $14.7bn a few years out.
– Assumes 20% CAGR p.a.
– Trades at 20xPE on steady-state earnings.

Exp. gain: Not specified.

Full $ABNB write-up (free guest account required):

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