Critical Review: Airbnb (NASDAQ:ABNB) and Marriott International (NASDAQ:MAR)

Marriott International (NASDAQ:MAR) and Airbnb (NASDAQ:ABNB) are both large-cap consumer discretionary companies, but which is the superior business? We will contrast the two companies based on the strength of their analyst recommendations, profitability, dividends, risk, valuation, earnings and institutional ownership.

Institutional & Insider Ownership

70.7% of Marriott International shares are held by institutional investors. Comparatively, 80.8% of Airbnb shares are held by institutional investors. 11.4% of Marriott International shares are held by company insiders. Comparatively, 27.2% of Airbnb shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Analyst Ratings

This is a breakdown of current recommendations and price targets for Marriott International and Airbnb, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Marriott International	0	10	11	1	2.59
Airbnb	2	11	24	3	2.70

Marriott International presently has a consensus target price of $385.65, suggesting a potential upside of 14.60%. Airbnb has a consensus target price of $177.07, suggesting a potential downside of 2.68%. Given Marriott International’s higher probable upside, analysts clearly believe Marriott International is more favorable than Airbnb.

Profitability

This table compares Marriott International and Airbnb’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Marriott International	9.62%	-75.81%	10.56%
Airbnb	20.45%	33.38%	10.67%

Earnings and Valuation

This table compares Marriott International and Airbnb”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Marriott International	$26.19 billion	3.35	$2.60 billion	$9.65	34.87
Airbnb	$12.24 billion	8.90	$2.51 billion	$4.40	41.35

Marriott International has higher revenue and earnings than Airbnb. Marriott International is trading at a lower price-to-earnings ratio than Airbnb, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

Marriott International has a beta of 1.11, meaning that its stock price is 11% more volatile than the S&P 500. Comparatively, Airbnb has a beta of 1.16, meaning that its stock price is 16% more volatile than the S&P 500.

Summary

Airbnb beats Marriott International on 11 of the 15 factors compared between the two stocks.

About Marriott International

Marriott International, Inc. engages in operating, franchising, and licensing hotel, residential, timeshare, and other lodging properties worldwide. It operates its properties under the JW Marriott, The Ritz-Carlton, The Luxury Collection, W Hotels, St. Regis, EDITION, Bvlgari, Marriott Hotels, Sheraton, Westin, Autograph Collection, Renaissance Hotels, Le Méridien, Delta Hotels by Marriott, Tribute Portfolio, Gaylord Hotels, Design Hotels, Marriott Executive Apartments, Apartments by Marriott Bonvoy, Courtyard by Marriott, Fairfield by Marriott, Residence Inn by Marriott, SpringHill Suites by Marriott, Four Points by Sheraton, TownePlace Suites by Marriott, Aloft Hotels, AC Hotels by Marriott, Moxy Hotels, Element Hotels, Protea Hotels by Marriott, City Express by Marriott, and St. Regis Longboat Key brand names, as well as operates residences, timeshares, and yachts. The company was founded in 1927 and is headquartered in Bethesda, Maryland.

About Airbnb

Airbnb, Inc., together with its subsidiaries, operates a platform that enables hosts to offer stays and experiences to guests worldwide. The company’s marketplace connects hosts and guests online or through mobile devices to book spaces and experiences. It primarily offers private rooms, primary homes, and vacation homes. The company was formerly known as AirBed & Breakfast, Inc. and changed its name to Airbnb, Inc. in November 2010. Airbnb, Inc. was founded in 2007 and is headquartered in San Francisco, California.