Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, online vacation rental marketplace HomeAway (Nasdaq: AWAY) has received a distressing two-star ranking.

With that in mind, let's take a closer look at HomeAway's business and see what CAPS investors are saying about the stock right now.

HomeAway facts

Headquarters (founded) Austin, Texas (2004)
Market Cap $2.94 billion
Industry Internet information providers
Trailing-12-Month Revenue $200.8 million
Management Co-Founder/CEO Brian Sharples
Co-Founder/Chief Strategy Officer Carl Shepherd
Trailing-12-Month Operating Margin 9%
Cash / Debt $111.6 million / $0
Competitors Google (Nasdaq: GOOG) (Nasdaq: PCLN)
Travelzoo (Nasdaq: TZOO)

Sources: Capital IQ (a division of Standard & Poor's) and Motley Fool CAPS.

On CAPS, 31% of the 52 members who have rated HomeAway believe the stock will underperform the S&P 500 going forward. These bears include hagrin and starz188.

Just last month, hagrin touched on HomeAway's seemingly unsustainable valuation: "Add it to the internet bubble of [LinkedIn] and [Pandora]. I'm going to be short on all of these stocks after they have been public for a few hours because none of them have the revenues or profits to justify these valuations."

In fact, HomeAway sports a particularly lofty forward P/E of 69. That represents a clear premium to rivals such as Google (13), priceline (17), and Travelzoo (20).

CAPS member starz188 also believes that the HomeAway bear case all boils down to price:

They're not a bad company. They really aren't. ... They've been steadily growing revenue since 2006, and they finally emerged in the black in 2009 (net income). ... They have cash on hand, decent assets on the balance sheet, and reasonable liabilities. ... However, no matter how much I look at their financials, I just can't see a $3B company!
Not yet, anyway. They have some serious growth potential in Europe, and their renewal rates are rising, along with web traffic. This is a healthy company -- just not quite worth the current valuation.

What do you think about HomeAway, or any other stock, for that matter? If you want to retire rich, you need to protect your portfolio from any undue risk. Staying away from dangerous stocks is crucial to securing your financial future, and on Motley Fool CAPS, thousands of investors are working every day to flag them. CAPS is 100% free, so get started!  

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