D.A. Davidson upgrades Airbnb on strong fundamentals and long-term potential

Investing.com -- D.A. Davidson upgraded Airbnb Inc (NASDAQ: ABNB). to "Buy" from "Neutral" saying the company is well-positioned for long-term growth and trades at a reasonable valuation following a recent pullback in its stock.

Airbnb shares have fallen about 23% over the past year, and D.A. Davidson said the stock now trades at a 14% discount to its one-year average EV/EBITDA multiple and a 30% discount to its average since early 2022.

The firm said Airbnb’s leadership in alternative accommodations, with more than 8 million listings globally, gives it strong pricing flexibility and allows it to serve a wide range of travelers.

Recent product updates focused on affordability, such as weekly and monthly discounts, have helped keep average prices steady while hotel rates have climbed, analysts noted.

D.A. Davidson also sees potential from new product launches in the coming quarters, including Airbnb’s upcoming May “Summer Release,” which could introduce new revenue streams.

The firm slightly lowered its 2025 revenue estimate by 2.5% and cut adjusted EBITDA by 4% to reflect possible macroeconomic headwinds. It also reduced its price target to $155 from $170, based on a 21x EV/EBITDA multiple.

Despite those adjustments, the firm said Airbnb remains one of the strongest players in online travel and should benefit from ongoing global growth in alternative lodging.

The brokerage also added Airbnb to its best company list, which consists of firms strong fundamentals and long-term potential.

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