Josh Brown did a double-take when this travel name made it onto his Best Stocks list
(This is The Best Stocks in the Market , brought to you by Josh Brown and Sean Russo of Ritholtz Wealth Management.) Josh — Once upon a DealBook conference, I was sitting in the audience as Andrew Ross Sorkin interviewed Brian Chesky, the founder and CEO of Airbnb (ABNB) . It was on the runway to go public and there was still a lot of controversy about its business model. Many people were shocked that millennials would be so comfortable sharing their homes with strangers for short-term rental income or living temporarily in other people’s random apartments and houses. For a vacation. It sounded insane, but it was also working. Like Uber , Airbnb had invented a new thing before most people even knew there was a high demand for it. I came away from that event highly impressed with Chesky but with no interest at all in making an investment in the company. So when the IPO day finally came, I barely paid attention. That apathy paid off as the stock quickly peaked out at $219, collapsed a few months later to $80 during the depths of the 2022 tech crash. In the three-and-a-half years since, it’s been building a massive, multiyear base as the fundamentals have caught up to the unwarranted valuation it came public at. When Airbnb hit the Best Stocks in the Market list, I did a double-take. It had been awhile since I’d even heard anyone talking about it. The travel stocks have been ripping for three years while this one mostly sat the party out. Booking Holdings is up 166% over the last three years. Hilton is up 129%. Marriott 115%. Expedia 223%. Airbnb is up 59% over that same stretch. That’s not a bad number on its own, but next to the rest of the group it tells you exactly what has been happening. While every other major travel name compounded year after year, ABNB went essentially flat for two consecutive years. 2024: down 3%. 2025: up 3%. The sector kept going. This one was stuck in its base, grinding sideways. And now the sentiment’s been flipped. This is why we’re bringing you the story today. Sean’s going to walk you through the fundamentals below and they’re exceptional. The reason was sentiment. The market was skeptical that Airbnb’s growth runway matched its peers. That skepticism is now being repriced. The Q2 report that just landed was not a modest beat. It was an acceleration. Revenue growth has moved from 6% to 17% over six consecutive quarters. Management raised full-year guidance for the second time. Free cash flow hit $1.25 billion in a single quarter. The stock that spent two years being ignored by the same investors who loaded up on Hilton and Marriott is now having its moment. Best Stock Spotlight: Airbnb, Inc. (ABNB) Sean — We’ve spent a lot of time on travel in this column. Hilton, Marriott and Viking in April and Expedia three separate times going back to September of last year. The signal in that is post-Covid travel has behaved like a secular growth story, not a cyclical one. Most economists thought the travel boom would slow. Most survey respondents complain about the cost of in-person events while waiting in line for $200 tickets to the Sphere. Everyone seems to point to the “upper K” while simultaneously proving it’s more than just rich people spending money. There are too many setups in these travel companies for us to ignore, so let’s discuss a new one to the list — Airbnb. I mentioned the start of a super-decade of travel for the U.S. in earlier travel columns. The World Cup and the U.S.’ 250th this year, the Los Angeles Olympics in 2028, the Men’s and Women’s Rugby World Cups in 2031 and 2033 and the Salt Lake City Winter Games in 2034, on top of all of the other sporting events and concert series happening concurrently all year, every year. The U.S. Travel Association projects total U.S. travel spending reaching $1.5 trillion by 2029, with international visits hitting a record 82 million that same year. Airbnb was an official World Cup tournament partner, and more than 150,000 homes across host cities were listed on the platform for the first time. CEO Brian Chesky’s framing is that bookings from any single event are temporary, but the new hosts and brand awareness create powerful network effects. ABNB is now running the same playbook at the Olympics, the Tour de France, Art Basel, Lollapalooza, LaLiga and Nascar. Every mega-event on that calendar is a Trojan Horse for transactions on the Airbnb platform. These events are flowing to Airbnb’s margin. The second quarter set the stock off with revenue growing 17% to $3.61 billion against a $3.58 billion consensus, EPS came in at $1.37 versus $1.25 expected and gross booking value grew 16% to $27.2 billion. Adjusted EBITDA was $1.3 billion with a 35% margin, up over 100 basis points year over year and free cash flow grew 30% to $1.25 billion. Nights and seats booked grew 10% and accelerated from Q1. Look at the revenue growth sequence over the last six quarters: 6%, 12%, 10%, 12%, 18%, 17%. Management raised full-year guidance for the second time this year, to at least mid-teens revenue growth from low-to-mid-teens and lifted the full-year adjusted EBITDA margin target to at least 35.5% from 35%. Chesky told analysts that “AI is the best thing to ever happen to Airbnb.” They’ve cut concept-to-launch time by as much as 60% on key engineering initiatives and shipped nearly 80% more product features in the first half than the same period last year. The AI assistant now handles support in more than 50 languages and resolves close to 45% of issues without a human agent, which drove customer support cost per booking down 16% year-over-year. This is one of the first and cleanest examples of AI helping the bottom line that I’ve seen for an S & P 500 constituent. ABNB repurchased $1.1 billion of stock in Q2 under the $6 billion authorization the board approved in August 2025 and trailing twelve-month free cash flow is $4.8 billion at a 37% margin. Diluted share count has gone from 649 million in mid-2024 to 597 million today. The stock is still about 14% below its February 2021 high while the business has more than doubled since. Fundamentals are catching up with price, this is a textbook example of a Best Stocks constituent. Now here’s Josh with the risk management. Risk management Josh — Airbnb spent most of the last year building a base. The stock worked through a wide, choppy range from the fall of 2025 all the way into summer 2026, unable to generate any real conviction in either direction. Then the Q2 report Sean described above arrived and everything changed. ABNB gapped out of that base on the heaviest volume in over a year, opening around $163 and leaving a clean air pocket below it. The stock has continued higher from there to $188, with the 50-day rising at $157 and the 200-day at $137, both well below current price and pointed in the right direction. The base did its job. RSI is 70. That is elevated, but breakaway gaps from long bases tend to stay overbought longer than you’d expect. This is not a momentum reading that came from a speculative panic. It reflects real institutional buying on a real catalyst. Nothing broken here. Traders can use $163 as their line in the sand. That is the first price paid after the air pocket, and a close back below it means the gap is being filled and the urgency behind this move has reversed. In essence, you get to find out real fast if you’re wrong. Closing prices only, don’t get whipsawed intraday. Investors can anchor to the rising 50-day at $157, which marks the top of the base this stock just broke out of. Below that on a weekly close and the breakout has failed. DISCLOSURES: (None) All opinions expressed by the CNBC Pro contributors are solely their opinions and do not reflect the opinions of CNBC, or its parent company or affiliates, and may have been previously disseminated by them on television, radio, internet or another medium. THIS CONTENT IS PROVIDED FOR INFORMATIONAL PURPOSES ONLY AND DOES NOT CONSTITUTE FINANCIAL, INVESTMENT, TAX OR LEGAL ADVICE OR A RECOMMENDATION TO BUY ANY SECURITY OR OTHER FINANCIAL ASSET. THE CONTENT IS GENERAL IN NATURE AND DOES NOT REFLECT ANY INDIVIDUAL’S UNIQUE PERSONAL CIRCUMSTANCES. THE ABOVE CONTENT MIGHT NOT BE SUITABLE FOR YOUR PARTICULAR CIRCUMSTANCES. BEFORE MAKING ANY FINANCIAL DECISIONS, YOU SHOULD STRONGLY CONSIDER SEEKING ADVICE FROM YOUR OWN FINANCIAL OR INVESTMENT ADVISOR. Click here for the full disclaimer.
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