Airbnb pleases investors with strong report-shares rise
2023.02.15 13:19
Airbnb pleases investors with strong report-shares rise
By Kristina Sobol
Budrigannews.com – Before the bell on Wednesday, shares of Airbnb Inc. rose 9% and were set to open at their highest level since May as investors applauded the company’s bullish revenue forecast and tight cost control in the face of growing economic concerns.
After the vacation rental company’s fourth-quarter results exceeded market expectations, at least ten brokerage firms increased their price targets for the stock.
Atlantic Equities predicted that overall travel demand would translate into strong financial performance, despite the fact that Airbnb noted pressures on average daily rates throughout the year as a result of increased bookings from less expensive urban areas and regions like Latin America.
From $115, the brokerage increased its price target to $130. $136 is the typical Wall Street target.
A boom in travel, aided by a strong U.S. dollar, flexible work arrangements, and household savings, has sped up the industry’s recovery from the pandemic.
Airbnb raised its first-quarter revenue forecast on Tuesday to $1.75 billion to $1.82 billion, exceeding analysts’ average estimate of $1.69 billion.
Due to the fact that some analysts do not anticipate any issues from an excessive number of listings at this time, the rental company stated that it anticipates maintaining its margin of 35% from the previous year.
According to Ivan Feinseth, Chief Investment Officer at Tigress Financial Partners LLC, “Airbnb has tremendous wind at its back because both consumer and business travel continues to grow at a rapid rate from the post-pandemic recovery and remain strong.”
The results of Airbnb are also expected to allay concerns that travel demand may be decreasing as a result of economic woes.
Analysts from Piper Sandler stated, “ABNB’s print appears to support our view that travel remains resilient despite a more mixed macro.”
The price of one share was $132.00. In 2022, they had decreased by nearly 50%.
Tripadvisor Inc., an online travel booking company, had also released quarterly results on Wednesday that were better than anticipated. This resulted in its shares rising 9.3% to $27.48 in premarket trading.
