Should I Invest in Airbnb?
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.