Remote Work And Emerging Travel Will Fuel B2B SaaS Growth

Key Takeaways

• Integration of strategic acquisitions and rapid product growth positions HomeToGo for sustained high-margin expansion, increased operating leverage, and strong multi-year revenue acceleration.
  
• Scalable B2B tech and payments infrastructure, plus global inventory reach, enable HomeToGo to capture rising online travel spend and lower acquisition costs compared to competitors.
  
• Heavy dependence on external partners, regulatory risks, rising costs, and evolving travel trends threaten HomeToGo's growth prospects and competitive position in the vacation rental sector.

Catalysts

Operates a marketplace for vacation rentals that connects users searching for a place to stay in Luxembourg and internationally.

• Analyst consensus expects strong revenue growth from the Interhome acquisition and HomeToGo_PRO scaling, but this may understate the upside-combined with the surging 200 percent year-over-year growth in Doppelganger and 30 percent plus ARR growth at Smoobu, HomeToGo is poised for exponential expansion in high-margin B2B SaaS and services, delivering outsize gains in both revenue and EBITDA margin for years beyond initial integration.
  
• Analysts broadly agree HomeToGo Payments will steadily improve conversion and margins through savings and user adoption, but the platform's rapid acceleration-now exceeding full-year 2024 volumes by 20 percent in just half a year and already processing 30 percent of onsite booking value-signals a much faster transformation into a powerful margin-enhancing financial infrastructure, with embedded finance opportunities unlocking additional revenue streams and free cash flow step-changes ahead of expectations.
  
• The full integration of Vrbo's global inventory, along with valuable web assets like ferienhaus.de, will allow HomeToGo to dominate search visibility and user acquisition well beyond core European markets, turbocharging organic demand and materially lowering long-term customer acquisition costs, thus driving enhanced operating leverage and boosting net margin structurally as travel digitalization accelerates.
  
• HomeToGo's differentiated focus on B2B tech infrastructure-enabling partners to instantly embed white-label inventory and optimize distribution via APIs-uniquely positions the company as the default operating system for alternative accommodations, directly benefiting from the sustained global shift toward remote work and experiential travel, and creating a compounding network effect that fuels multi-year compounding revenue growth.
  
• With the rising global middle class and dramatic expansion of travel in emerging markets, HomeToGo's scalable platform and multi-market presence equip it to outpace slower incumbents, capturing the fastest-growing segment of online travel spend and vastly expanding its addressable market size, which over time will translate into enduring revenue acceleration and increasing customer lifetime value.

HomeToGo Future Earnings and Revenue Growth

Assumptions

• This narrative explores a more optimistic perspective on HomeToGo compared to the consensus, based on a Fair Value that aligns with the bullish cohort of analysts.
• The bullish analysts are assuming HomeToGo's revenue will grow by 32.4% annually over the next 3 years.
• The bullish analysts assume that profit margins will increase from -17.1% today to 6.5% in 3 years time.
• The bullish analysts expect earnings to reach €32.5 million (and earnings per share of €nan) by about August 2028, up from €-36.9 million today. The analysts are largely in agreement about this estimate.
• In order for the above numbers to justify the price target of the more bullish analyst cohort, the company would need to trade at a PE ratio of 40.6x on those 2028 earnings, up from -7.6x today. This future PE is greater than the current PE for the DE Hospitality industry at 23.3x.
• Analysts expect the number of shares outstanding to grow by 7.0% per year for the next 3 years.
• To value all of this in today's terms, we will use a discount rate of 6.15%, as per the Simply Wall St company report.

HomeToGo Future Earnings Per Share Growth

Risks

• HomeToGo's business model remains heavily reliant on third-party supply aggregation and partnerships, such as Vrbo and Interhome, making the platform vulnerable to disintermediation if property owners or major partners shift bookings to direct channels or alternative OTAs, which could threaten sustained revenue growth.
  
• Intensifying regulatory scrutiny and increasing legal restrictions on short-term rentals in key global and European destinations could reduce inventory availability over time, creating a headwind for future revenue and market share growth.
  
• The company's ongoing strategy of prioritizing profitability over growth in its B2C Marketplace segment has resulted in only modest revenue growth and even slight revenue declines in certain periods, which could limit its ability to scale and compete with larger OTAs, ultimately impacting long-term top line expansion and earnings power.
  
• HomeToGo faces structurally increasing customer acquisition and marketing costs as large industry peers like Airbnb and Booking.com ramp up their own investments, which, coupled with a shift toward professionally managed accommodations, could put pressure on net margins and slow down margin improvement going forward.
  
• The vacation rental sector is exposed to secular risks such as normalization in travel volumes due to post-pandemic changes in remote work and increased public focus on sustainable travel; if HomeToGo fails to adapt, this may lead to stagnating demand, reduced booking volumes, and dampened revenue growth over the long term.

Valuation

• The assumed bullish price target for HomeToGo is €5.2, which is the highest price target estimate amongst analysts. This valuation is based on what can be assumed as the expectations of HomeToGo's future earnings growth, profit margins and other risk factors from analysts on the bullish end of the spectrum.
  
• However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of €5.2, and the most bearish reporting a price target of just €3.1.
  
• In order for you to agree with the bullish analysts, you'd need to believe that by 2028, revenues will be €501.6 million, earnings will come to €32.5 million, and it would be trading on a PE ratio of 40.6x, assuming you use a discount rate of 6.2%.
  
• Given the current share price of €1.62, the bullish analyst price target of €5.2 is 68.8% higher.
  
• We always encourage you to reach your own conclusions though. So sense check these analyst numbers against your own assumptions and expectations based on your understanding of the business and what you believe is probable.