Airbnb (ABNB 0.75%) reported its fourth-quarter results on Feb. 13, and both revenue and management's guidance were better than what Wall Street was expecting.

This top travel stock is up almost 16% year to date as of this writing, and it has climbed about 85% since the start of last year, far exceeding the broad market.

But with shares still sitting 27% below their peak price, should you buy Airbnb hand over fist with $1,000 right now?

Strong momentum

During the last three months of 2023, Airbnb's revenue increased 17% year over year to $2.22 billion. While its growth has slowed from prior quarters, that double-digit pace is still impressive, especially when you consider the uncertain macroeconomic environment. It looks like consumers are still ready to spend on travel and experiences, though, as Airbnb reported more than $73 billion of gross bookings last year.

The company produced adjusted EBITDA of $738 million in Q4, beating the analysts' consensus estimate of $645 million. Of course, for a business that's still in growth mode, investors should pay attention to the consistency of profits.

Management's outlook call for the top-line to grow 13% (at the midpoint) to $2.05 billion in the current quarter. This, too, was more than Wall Street was expecting.

Economic moat

Before buying any company's stock, investors should look for the presence of an economic moat. This is a concept the great Warren Buffett popularized, referring to a characteristic or a set of characteristics that can be expected to provide a company with durable advantages that allow it to outperform rivals and fend off new competitors over an extended period.

Airbnb's moat stems from powerful network effects. The company operates a two-sided platform that only becomes more valuable as it grows.

Its services are available in 220 countries and regions across the globe. The company counts over 5 million hosts and 7.7 million listings. And there were 99 million nights and experiences booked last quarter. This clearly demonstrates Airbnb's massive scale.

Because there are so many listings on the site, travelers have plenty of options to choose from. On the other side of the equation, hosts benefit from having their properties on Airbnb because it puts their listings in front of a huge global customer base.

Given the massive head start Airbnb has enjoyed in building out its platform, it has been exceedingly difficult for rival companies to compete with Airbnb.

The unmatched scale of this marketplace has become quite lucrative too. The company generated $3.8 billion of free cash flow in 2023, up 12% from 2022. And showing how confident they are in the company's financial position, management just approved a $6 billion share buyback program.

Looking at valuation

As of this writing, Airbnb stock is about 27% below its all-time high, which was set in Feb. 2021. Investors who believe in the quality of this business should take a closer look at the shares as a potential investment opportunity. The stock trades at a price-to-earnings ratio of 18.9. That's a discount to both the S&P 500 and Nasdaq-100.

The setup for prospective investors is favorable right now, but things could be volatile in the near term. A recession could be a speed bump for Airbnb's strong momentum. But for those who have a long-term mindset, this looks like a good time to buy the stock.