Should I Invest in Airbnb?
The market’s optimistic valuation for Airbnb is tough to accommodate.
The market’s optimistic valuation for Airbnb is tough to accommodate.
Although Airbnb (ABNB) shares have tumbled roughly 30% since mid-March (versus an 9% increase in the Morningstar US Market Total Return Index), the current price still appears elevated, at a 70% premium to our intrinsic valuation. Our fair value estimate for Airbnb currently sits at $84, compared with the average sell-side target price of $171.
We believe two main factors are driving the market’s overvaluation:
Dan Wasiolek does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.