Strong Gross Profit Margin
Reasonable Debt Levels
Strong Return on Equity
Healthy Net Profit Margin
Strong Liquidity Ratios
Low Debt to Assets Ratio
Strong Revenue Growth
High Free Cash Flow Generation
Technological Advancements
Multiyear Growth Strategy
Investment in New Businesses
AI Integration
High Valuation Ratios
Elevated EV/EBITDA Ratio
Interest Coverage Ratio Issue
Market Sensitivity
Overall, Airbnb demonstrates strong business quality through its robust revenue growth, significant cash flow generation, and ongoing technological advancements. Future prospects remain promising due to a clear growth strategy and innovation plans, although short-term market sensitivities could pose challenges.
Analysis Date: February 13, 2025
Last Updated: March 11, 2025
Trailing Twelve Months (TTM) values provide a view of the company's performance over the last year.
Benjamin Graham's value investing approach focuses on finding stocks with a significant margin of safety between their intrinsic value and market price.
Intrinsic Value
Estimated fair value based on Graham's formula
$163.12
Current Market Price: $107.61
IV/P Ratio: 1.52x (>1.0 indicates undervalued)
Margin of Safety
Gap between intrinsic value and market price
34.0%
Graham recommended a minimum of 20-30% margin of safety
Higher values indicate a greater potential discount to fair value
Graham Criteria Checklist
Benjamin Graham's value investing checklist for ABNB
Positive earnings (5+ years)
Dividend history (5+ years)
P/E ratio ≤ 20 (25.17)
P/B ratio ≤ 1.5 (7.92)
Current ratio ≥ 2.0 (1.69x)
Long-term debt < Net current assets (0.32x)
Margin of safety (34.0%)
ABNB does not meet all Graham criteria
Trailing Twelve Months (TTM) values provide a view of the company's performance over the last year.
ABNB's return on equity (ROE) is 32.29%, which is significantly above the industry average, indicating effective use of equity to generate profits.
With a net profit margin of 23.85%, ABNB demonstrates strong profitability after all expenses have been accounted for.
Profitability metrics measure a company's ability to generate earnings relative to its revenue, operating costs, and other relevant metrics. Higher values generally indicate better performance.
Return on Equity (ROE)
Measures how efficiently a company uses its equity to generate profits
32.29%
Higher values indicate better returns for shareholders
TTM (as of 2025-04-16)
Return on Assets (ROA)
Measures how efficiently a company uses its assets to generate profits
2.20%
Higher values indicate better asset utilization
TTM (as of 2025-04-16)
Gross Profit Margin
Percentage of revenue retained after accounting for cost of goods sold
77.47%
Higher values indicate better efficiency in production
TTM (as of 2025-04-16)
Net Profit Margin
Percentage of revenue retained after accounting for all expenses
23.85%
Higher values indicate better overall profitability
TTM (as of 2025-04-16)
The current ratio of 1.69 and quick ratio of 1.69 indicate that ABNB is well-positioned to meet its short-term liabilities.
A debt to assets ratio of 0.11 suggests that the company has a low level of debt relative to its total assets, reinforcing financial stability.
An interest coverage ratio of 0.0 indicates that the company currently does not have sufficient earnings to cover interest expenses, which raises concerns about financial stability.
Financial health metrics assess a company's ability to meet its financial obligations and its overall financial stability.
Debt to Equity Ratio
Total debt divided by total equity
0.27x
Lower values indicate less financial leverage and risk
Less than 1.0 is conservative, 1.0-2.0 is moderate, >2.0 indicates high risk
Q4 2024
Current Ratio
Current assets divided by current liabilities
1.69x
Higher values indicate better short-term liquidity
Less than 1.0 is concerning, 1.0-2.0 is adequate, greater than 2.0 is good
Q4 2024
Airbnb reported a 12% year-over-year revenue growth in Q4 2024, reaching $2.5 billion. This indicates strong performance in a competitive travel market.
The company generated $4.5 billion in free cash flow for the full year 2024, representing a free cash flow margin of 40%. This reflects strong operational efficiency and financial health.
Airbnb has invested in rebuilding its platform with a new technology stack, which facilitates faster product updates and optimizations, enhancing user experience and operational efficiency.
Airbnb is executing a multiyear growth strategy focusing on perfecting core services, expanding globally, and launching new offerings. This strategic focus positions the company well for future growth.
The company plans to invest $200 to $250 million in launching and scaling new businesses in 2025, indicating a commitment to innovation and expansion.
Airbnb is planning to roll out AI-powered customer support and eventually integrate AI into its search functionalities, which could enhance the user experience and operational efficiency.
Airbnb's revenue growth forecasts for Q1 2025 are tempered by external factors such as FX headwinds and calendar impacts, indicating potential volatility in short-term performance.