Is Airbnb 'Reinventing' Itself With AI? 11 Analysts Deep Dive Into Q4 Results, Outlook

Shares of Airbnb Inc ABNB tanked in early trading on Wednesday, after the company reported upbeat revenues for the fourth quarter.

The results came amid an exciting earnings season. Here are some key analyst takeaways from the release.

DA Davidson On Airbnb

Analyst Tom White downgraded the rating from Buy to Neutral, while keeping the price target unchanged at $145.

Airbnb reported “solid” fourth-quarter results, with “decent” upside to revenues and adjusted EBITDA, White said in a note.

“Management’s outlook commentary for 1Q and CY’24 suggests that this year may reflect a more normalized room night growth environment for ABNB however, as well as the potential for some modest Y/Y EBITDA margin compression due to long-term growth investments in areas like deeper International market penetration, marketing, and AI/platform expansion,” the analyst added.

Piper Sandler On Airbnb

Analyst Thomas Champion reiterated a Neutral rating, while lifting the price target from $136 to $145.

Airbnb reported “another impressive” quarter, with gross booking value (GBV) and EBITDA margins around 3% and 400 basis points higher than expected, Champion said.

“Offsetting the positive 4Q, Nights growth should slip to HSD in 1Q given Easter timing and a tough y/y compare,” the analyst wrote. He added, however, that EBITDA margins could once again approach 35% in 2024.

Wedbush On Airbnb

Analyst Scott Devitt reaffirmed a Neutral rating while raising the price target from $150 to $160.

Despite strong fourth-quarter results, the company’s guidance for the first quarter reflects room night growth “modestly below consensus,” Devitt stated. He added that the 2024 guidance for adjusted EBTIDA margin of at least 35% is below the consensus estimate of around 37%.

“In addition to ongoing international expansion, Airbnb is investing in products and services beyond its core, with potential new product launches that could contribute to bookings growth as well as additional services that could deepen platform monetization and drive incremental take rate growth,” the analyst said.

RBC Capital Markets On Airbnb

Analyst Brad Erickson reiterated a Sector Perform rating, while lifting the price target from $140 to $150.

Airbnb reported its fourth-quarter bookings and EBITDA higher than expected, but its outlook “came up soft on nights for Q1 and FY margins,” Erickson said.

“Positively, pricing remains firm enabling strong EBITDA/FCF upside & optionality for the future,” the analyst wrote. “Less positively, nights are decelerating towards single-digits, near-term offsets aren't clear and flat FY margin guidance y/y was below Street, suggesting the company could be leaving room for less offensive-type investments,” he added.

Needham On Airbnb

Analyst Bernie McTernan reaffirmed a Buy rating while raising the price target from $150 to $160.

“While 4Q23 results beat our forecast, less-than-expected growth guidance for 1Q24 and a margin floor of 35% for '24E vs nearly 37% in '23 lead us to believe consensus numbers will decline,” McTernan wrote in a note.

“After a 4Q beat, we are reducing our bookings growth assumptions by -70bps in '24E to +8.7%, but revenue growth goes lower by -230bps to +7.2% on a lower take rate,” he added.

Check out other analyst stock ratings.

BMO Capital Markets On Airbnb

Analyst Brian Pitz maintained a Market Perform rating, while lifting the price target from $134 to $135.

Airbnb seems to be moving “towards a cross-vertical company from a single vertical,” Pitz said. “We believe that an AI-based concierge combined with a Viator-inspired experience backend could present a meaningful new source of travel demand.”

While AI integrations could improve “the guest and user experience,” the acquisition of GamePlanner.AI in November “positions Airbnb well to benefit from the application layer of generative AI,” the analyst further stated.

JPMorgan On Airbnb

Analyst Doug Anmuth reiterated a Neutral rating while raising the price target from $118 to $140.

“ABNB’s 4Q results were solid, but we believe the 1H topline deceleration and mgmt’s expectation for Adj. EBITDA margin compression—a floor of 35% in 2024 (-200 bps Y/Y)—are weighing,” Anmuth wrote.

Although management indicated stable demand in the first quarter, the revenue outlook of $2.03 billion to $2.07 billion includes “a 1-2pt benefit from Easter timing—which should flip to a headwind in 2Q—and implies 1H deceleration,” he added.

Goldman Sachs On Airbnb

Analyst Eric Sheridan reaffirmed a Sell rating, while lifting the price target from $122 to $123.

Overall travel demand continued to be strong in the fourth quarter, “with ABNB producing a modest GBV & revenue beat,” Sheridan said.

Management’s forward guidance is “a bit volatile/uncertain including a highlighting of tough YoY comps on room nights (a consistent theme across the travel industry thus far this earnings season),” he added.

Truist Securities On Airbnb

Analyst Patrick Scholes maintained a Hold rating and price target of $118.

“A sizable 14% 4Q23 EBITDA beat vs. consensus, driven by a combination of modestly better than expected revenues and significantly better than anticipated margins,” Scholes wrote in a note.

“We believe investor expectations going into earnings were for at least a small earnings beat, especially as some of the concerns around travel demand 'volatility' noted at the time of 3Q23 earnings in early November did not continue for the rest of the quarter,” the analyst added.

Baird On Airbnb

Analyst Colin Sebastian reiterated a Neutral rating and price target of $140.

There is some uncertainty around near-term travel and margin trend, “with management eyeing AI-based non-STR platform expansions,” Sebastian said. He added, however, that Airbnb is among the “higher-quality online marketplaces” with strong longer-term prospects.

“While there are signs of some moderation in travel in Q1, more interesting might be 2H-24 updates on 'reinventing' Airbnb through AI while expanding into new verticals,” the analyst further stated.

JMP Securities On Airbnb

Analyst Nicholas Jones reaffirmed a Market Perform rating.

“After seeing volatility in October, nights and experiences booked growth accelerated in November and December and did not experience any weakness in non-urban travel demand,” Jones said.

“Looking ahead to 2024, management noted it is time for ABNB to expand beyond the core and expects full-year EBITDA margin of at least 35%, which would be an almost 200bps contraction y/y, driven by deleverage in product development and sales and marketing,” he added.

ABNB Price Action: Shares of Airbnb had declined by 2.7% to $146.72 at the time of publication Wednesday.

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