Madison Large Cap Fund Added Airbnb (ABNB) on a Dip

Madison Investments, an investment advisor, released its “Madison Large Cap Fund” second-quarter 2025 investor letter. A copy of the letter can be downloaded here. In the second quarter, the fund (Class Y) increased 3.1%, compared to a 10.9% gain for the S&P 500 index. In addition, please check the fund’s top five holdings to know its best picks in 2025.

In its second quarter 2025 investor letter, Madison Large Cap Fund highlighted stocks such as Airbnb, Inc. (NASDAQ:ABNB). Headquartered in San Francisco, California, Airbnb, Inc. (NASDAQ:ABNB) operates a platform that connects hosts and guests. The one-month return of Airbnb, Inc. (NASDAQ:ABNB) was 6.75%, and its shares lost 7.22% of their value over the last 52 weeks. On July 18, 2025, Airbnb, Inc. (NASDAQ:ABNB) stock closed at $139.34 per share, with a market capitalization of $86.002 billion.

Madison Large Cap Fund stated the following regarding Airbnb, Inc. (NASDAQ:ABNB) in its second quarter 2025 investor letter:

"Portfolio activity picked up in the second quarter. We initiated positions in Airbnb, Inc. (NASDAQ:ABNB), CDW Corporation and Gartner and sold Berkshire Hathaway. Airbnb is a leader in the alternative accommodation lodging market with approximately 8 million active listings on its platform. The company has a dominant market position due to the network effect between guests and hosts where more supply (hosts) inherently attracts more demand (guests) which in turn attracts more supply. While the company is certainly more mature than it was a decade ago, we believe it can still grow at an attractive rate as it continues to gain share within the large travel accommodations market and through launching additional products and services to better monetize the bookings that occur on its platform. Its balance sheet and cash flow characteristics are also excellent. The uncertainty surrounding the tariff announcements and the potential for a deterioration in the macroeconomic environment caused the shares to meaningfully decline, which presented the opportunity to invest in Airbnb at an attractive price."

Airbnb, Inc. (NASDAQ:ABNB) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 66 hedge fund portfolios held Airbnb, Inc. (NASDAQ:ABNB) at the end of the first quarter, compared to 54 in the previous quarter. Airbnb, Inc. (NASDAQ: ABNB) reported a revenue of $2.3 billion in the first quarter of 2025, which represents a 6% increase compared to the same period last year. While we acknowledge the potential of Airbnb, Inc. (NASDAQ:ABNB) as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

In another article, we covered Airbnb, Inc. (NASDAQ:ABNB) and shared the list of best consumer discretionary stocks to buy. In addition, please check out our hedge fund investor letters Q2 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.