Mizuho Says This Top Pick Can Leverage AI to Expand its Dominance

Mizuho has designated Airbnb, Inc. (NASDAQ: ABNB) as its top pick in the Internet sector, raising its price target to $245 from $200 and upholding an Outperform rating. The firm anticipates Airbnb to establish a multi-billion dollar hotel enterprise on its platform, leveraging artificial intelligence to strengthen its market position in the travel industry beyond its existing short-term rental and accommodation services.

Mizuho attributes Airbnb's growth potential to its enhanced operating culture, which is increasingly reflected in the company's performance. The firm projects room night growth of around 12% in 2027 and 11.5% in 2028, revenue growth of 15.4% in 2027 and 14.8% in 2028, and earnings per share growth of 18% and 29%, respectively. Adjusted EBITDA is expected to reach $6.16 billion in 2027, compared to the Street's estimate of $5.77 billion, and $7.38 billion in 2028, surpassing Street estimates of $6.57 billion.

The analysts project adjusted earnings per share of $6.43 in 2027 and $8.26 in 2028, above consensus of $6.23 and $7.35.

The bullish outlook is centered on Airbnb's improving operating culture driving faster execution and accelerating growth in the core business, with room night growth outperforming by a significant margin in the last three years. Airbnb's upcoming product cycles, such as hotel supply expansion, dynamic pricing, advertising, loyalty programs, and AI-driven services in new verticals, are expected to fuel this growth.

The price target of $245 is based on a 30 times multiple for 2028 estimated GAAP EPS and a 25 times multiple for enterprise value to EBITDA. Currently, the stock trades at approximately 29 times 2027 estimates and 23 times 2028 estimates.