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

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

Volatility & Risk

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

Analyst Ratings

This is a summary of current recommendations for Airbnb and Target Hospitality, as reported by MarketBeat.com.

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

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

Profitability

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

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

Earnings and Valuation

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

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

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.

Institutional & Insider Ownership

80.8% of Airbnb shares are owned by institutional investors. Comparatively, 32.4% of Target Hospitality shares are owned by institutional investors. 27.2% of Airbnb shares are owned by insiders. Comparatively, 3.8% of Target Hospitality shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Summary

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

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.

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.