Airbnb Stock Surges Post Earnings: ETFs to Win

Group 1: Earnings and Revenue Performance - Airbnb shares increased by 14.5% on February 14, 2024, following a fourth-quarter earnings report that exceeded analysts' expectations, with earnings of $0.73 per share compared to the Zacks Consensus Estimate of$0.58 per share [1] - The company reported revenues of $2.48 billion in Q4, surpassing the Zacks Consensus Estimate by 2.47$2.22 billion in the same quarter last year [2] - Gross Booking Value reached $17.60 billion, exceeding the average estimate of$17.18 billion, with 111 million Nights and Experiences Booked, surpassing the average estimate of 108.49 million [5] Group 2: Future Outlook - Airbnb anticipates revenues between $2.23 billion and$2.27 billion for Q1 2025, slightly below the Zacks Consensus Estimate of $2.29 billion, with an EBITDA margin guidance of at least 34.5% for the full year 2025 [2] - Since its IPO in 2020, Airbnb has tripled both its revenue and Gross Booking Value, indicating strong growth momentum that the company aims to maintain into 2025 [2] Group 3: Valuation Metrics - Airbnb stock is considered overvalued, trading at a Price/Earnings ratio of 34.15X compared to the Leisure and Recreation Services industry's multiple of 19.69X, and a Price/Book ratio of 10.60X versus 2.24X for the industry [3] - The Price/Cash Flow ratio for Airbnb is 30.57X, significantly higher than the industry's 11.90X, indicating potential concerns regarding valuation [3] Group 4: Investment Alternatives - Investors may consider ETFs to mitigate company-specific risks associated with Airbnb, with several ETFs holding Airbnb stock in the range of 7.84% to 4.35% [4]