Should Investors Take Airbnb Home?

Listed on the NASDAQ in December 2020, Airbnb, Inc. (ABNB) is an online platform that allows owners of apartments, villas, bungalows, and private homestays to rent their properties to guests worldwide.

Based in California, Airbnb was co-founded by Brian Chesky, Nathan Blecharczyk and Joe Gebbia in 2007.

Performance Since IPO

Airbnb was one of the most successful IPOs of 2020. The expectations of a rebound in travelling resulted in a 135% increase in ABNB’s stock price on the very first day of trading. However, since its IPO, the stock has declined 21.1% to $114.17.

Near-Term Prospects

Airbnb’s growth potential can be gauged from its recently reported first-quarter results. The company not only surpassed analysts’ estimates but also crossed the pre-pandemic revenue and booking levels.

Further, its outlook for the second quarter looks very encouraging, as it expects strong travelling in the summer season to push revenues in the range of $2.03 billion to $2.13 billion.

Also, Airbnb has recently introduced major upgrades to its platform. The company’s constant efforts to improve the experience and attract new clients is another positive factor that reflects well on Airbnb’s future.

Analysts’ Take

Three days ago, Wolfe Research analyst Deepak Mathivanan maintained a Hold rating on Airbnb but lowered the price target to $130 from $170. The new price target implies 13.9% upside potential from current levels.

On May 12, Citigroup analyst Ronald Josey maintained a Buy rating on the stock with a price target of $200, implying 75.2% upside potential from current levels.

Josey is of the opinion that the new features introduced by Airbnb will lead to a more “engaging user experience”.

Overall, the stock has a Moderate Buy consensus rating based on 13 Buys and 15 Holds. Airbnb’s average price target of $190.23 implies upside potential of 66.6% to current levels.

Bloggers’ Stance

TipRanks data shows that financial bloggers are 75% Bullish on ABNB, compared to the sector average of 66%.

Website Traffic Growth

TipRanks’ Website Traffic tool, which uses data from SEMrush Holdings (SEMR), the world’s biggest website usage monitoring service, offers insight into ABNB’s performance.

According to the tool, airbnb.com recorded a 29.6% monthly increase in global unique visits in April, compared to the previous year. Further, the footfall on the company’s website has grown 35.2% against the same period last year.

This data also indicates that the company’s performance in the upcoming quarter might be promising.

Takeaway

Airbnb has successfully braved all the challenges put forth by the pandemic. Also, its reputation among travelers and improving financials are other tailwinds.

The stock is down 33.9% so far this year, which could be a good entry point for investors interested in the stock.

Learn more about the Website Traffic tool in this video by Youtube sensation Tom Nash.