Competitor Analysis: Evaluating Airbnb And Competitors In Hotels, Restaurants & Leisure Industry

In the dynamic and cutthroat world of business, conducting thorough company analysis is essential for investors and industry experts. In this article, we will undertake a comprehensive industry comparison, evaluating Airbnb (NASDAQ:ABNB) and its primary competitors in the Hotels, Restaurants & Leisure industry. By closely examining key financial metrics, market position, and growth prospects, our aim is to provide valuable insights for investors and shed light on company's performance within the industry.

Airbnb Background

Started in 2008, Airbnb is the world's largest online alternative accommodation travel agency; it also offers booking services for boutique hotels and experiences. Airbnb's platform offered over 8 million active accommodation listings as of Dec. 31, 2024. Listings from the company's 5 million-plus hosts are spread over almost every country in the world. In 2024, 45% of revenue was from North America, 37% from Europe, the Middle East, and Africa, 9% from Latin America, and 9% from Asia-Pacific. Transaction fees for online bookings account for all its revenue.

Upon a comprehensive analysis of Airbnb, the following trends can be discerned:

• At 29.05, the stock's Price to Earnings ratio is 0.36x less than the industry average, suggesting favorable growth potential.

• The current Price to Book ratio of 8.59, which is 0.31x the industry average, is substantially lower than the industry average, indicating potential undervaluation.

• The Price to Sales ratio of 6.42, which is 2.1x the industry average, suggests the stock could potentially be overvalued in relation to its sales performance compared to its peers.

• The Return on Equity (ROE) of 16.76% is 23.82% below the industry average, suggesting potential inefficiency in utilizing equity to generate profits.

• The Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of $1.62 Billion is 0.6x below the industry average, suggesting potential lower profitability or financial challenges.

• The gross profit of $3.55 Billion is 1.36x above that of its industry, highlighting stronger profitability and higher earnings from its core operations.

• The company's revenue growth of 9.73% exceeds the industry average of 9.19%, indicating strong sales performance and market outperformance.

Debt To Equity Ratio

The debt-to-equity (D/E) ratio measures the financial leverage of a company by evaluating its debt relative to its equity.

Considering the debt-to-equity ratio in industry comparisons allows for a concise evaluation of a company's financial health and risk profile, aiding in informed decision-making.

When assessing Airbnb against its top 4 peers using the Debt-to-Equity ratio, the following comparisons can be made:

• Airbnb is in a relatively stronger financial position compared to its top 4 peers, as evidenced by its lower debt-to-equity ratio of 0.26.

• This implies that the company relies less on debt financing and has a more favorable balance between debt and equity.

Key Takeaways

For Airbnb in the Hotels, Restaurants & Leisure industry, the PE and PB ratios suggest the company is undervalued compared to its peers. However, the high PS ratio indicates a premium valuation based on revenue. In terms of profitability, Airbnb's low ROE and EBITDA suggest lower returns compared to industry peers. The high gross profit and revenue growth indicate strong operational performance and potential for future growth in the industry sector.

This article was generated by Benzinga's automated content engine and reviewed by an editor.