Reviewing Airbnb (NASDAQ:ABNB) and Target Hospitality (NASDAQ:TH)

Target Hospitality (NASDAQ:TH) and Airbnb (NASDAQ:ABNB) are both consumer discretionary companies, but which is the better business? We will contrast the two businesses based on the strength of their analyst recommendations, profitability, institutional ownership, risk, dividends, valuation and earnings.

Profitability

This table compares Target Hospitality and Airbnb’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Target Hospitality	-10.85%	-9.80%	-6.65%
Airbnb	20.45%	33.38%	10.67%

Analyst Ratings

This is a summary of recent ratings and recommmendations for Target Hospitality and Airbnb, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Target Hospitality	1	0	4	1	2.83
Airbnb	2	13	27	2	2.66

Target Hospitality currently has a consensus price target of $25.20, indicating a potential upside of 123.21%. Airbnb has a consensus price target of $182.65, indicating a potential upside of 3.56%. Given Target Hospitality’s stronger consensus rating and higher probable upside, analysts clearly believe Target Hospitality is more favorable than Airbnb.

Valuation and Earnings

This table compares Target Hospitality and Airbnb”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Target Hospitality	$320.64 million	3.51	-$37.12 million	($0.38)	-29.71
Airbnb	$12.24 billion	8.63	$2.51 billion	$4.40	40.08

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

Insider and Institutional Ownership

32.4% of Target Hospitality shares are held by institutional investors. Comparatively, 80.8% of Airbnb shares are held by institutional investors. 3.8% of Target Hospitality shares are held by company insiders. Comparatively, 27.2% of Airbnb shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Risk and Volatility

Target Hospitality has a beta of 1.56, suggesting that its share price is 56% more volatile than the S&P 500. Comparatively, Airbnb has a beta of 1.26, suggesting that its share price is 26% more volatile than the S&P 500.

Summary

Airbnb beats Target Hospitality on 12 of the 15 factors compared between the two stocks.

About Target Hospitality

Target Hospitality Corp. operates as a specialty rental and hospitality services company in North America. The company operates through two segments, Hospitality & Facilities Services – South and Government. It owns a network of specialty rental accommodation units. In addition, the company provides catering and food, maintenance, housekeeping, grounds-keeping, security, health and recreation facilities, workforce community management, concierge, and laundry services. It serves the U.S. government contractors and investment grade natural resource development companies. Target Hospitality Corp. was founded in 1978 and is headquartered in The Woodlands, Texas.

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.