Airbnb (ABNB) has experienced a robust rebound over the past month, with its stock climbing to $140.07 after an extended period of underperformance relative to the S&P 500 since mid-2025. Recent headlines highlight the ongoing tension between platform growth and operational risks, specifically the highly publicized "squatter" incidents. While these cases present material reputational and trust challenges for hosts, the recent DC judge's ruling favoring homeowner rights offers a crucial legal precedent that could mitigate future incidents and reinforce platform integrity. Furthermore, the "disillusionomics" trend among Gen Z, spurring diversified income streams, may surprisingly bolster Airbnb's host supply.

Our long-term growth thesis remains intact, anchored by Airbnb's dominant position in the flexible accommodations market and secular tailwinds in travel. The absence of a dividend yield is justified by management's continued reinvestment into product innovation, host support, and strategic market expansion, all vital for compounding intrinsic value and driving capital appreciation. Despite its current valuation reflecting a premium, we believe ABNB's asset-light model and ability to capitalize on evolving consumer behaviors position it for significant total return potential, especially as it navigates and mitigates operational challenges to fortify its competitive moat.