- AirBnB has opened a vast new opportunity by making underutilized private homes, rooms, and living room couches available to travelers for less money than comparable alternatives.
- The OTAs (online travel agencies) were hit hard by the COVID-19 pandemic, but AirBnB has rebounded more strongly than the Booking and Expedia.
- I believe AirBnB's market remains under-penetrated, and the company has a long runway to grow with the resumption of travel activity as COVID-19 subsides.
- Following the market contraction resulting from the Russian invasion of Ukraine and prospect of higher interest rates, AirBnB's free cash flow yield is now ~2.6%.
- I believe AirBnB's valuation looks attractive given its long-term growth prospects. However, with the current political and economic uncertainties, I do not think it is prudent to back up the truck. Instead, I plan to grow my position over time.
For further details see:
AirBnB: Travel Leader With A Long Runway And (Almost) Attractive Valuation