Citi turned bullish on Airbnb (NASDAQ:ABNB) on its view the online travel player is emerging from the pandemic a more profitable company and with 90% of traffic organic in hand. Alternative accommodations are noted to be gaining adoption as a preferred lodging type with Airbnb (ABNB) defining the category.
The firm assumed coverage on ABNB with a Buy rating.
Analyst Ronald Josey: "With six million active listings and four+ million hosts across 100K cities globally, we believe Airbnb is defining the Alternative Accommodations market, particularly around longer term stays given an increasingly flexible workforce and we believe the platform is well positioned to benefit as global travel recovers in 2022 and beyond."
Citi assigned a price target of $200, which works out to ~13X the 2023 EV/revenue estimate and implies a 45X multiple off the 2023 EV/EBTIDA. Shares of ABNB currently trade at 10X Citi's 2023 EV/revenue estimate and reflect a ~30% discount to Airbnb's (ABNB) two-year forward average since IPO.
Shares of ABNB rose 1.23% premarket to $172.21.
Counterpoint: Airbnb was viewed cautiously at Bank of America.