Adversity is less terrifying than hope: Airbnb Inc. (ABNB)

Airbnb Inc. (NASDAQ: ABNB) stock jumped 4.62% on Friday to $116.34 against a previous-day closing price of $111.20. With 14.18 million shares changed hands, the volume of the stock remained heavier than its average volume of 7.9 million shares. During the session, the Travel Services company that operates in wider Consumer Cyclical sector, reached to the highest price of $117.78 whereas the lowest price it dropped to was $111.15. The 52-week range on ABNB shows that it touched its highest point at $212.58 and its lowest point at $86.71 during that stretch. It currently has a 1-year price target of $169.73.

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Price Performance and Earnings:

Stock performance is one of the indicators that investors use to determine whether they will profit from a stock. The price performance of ABNB was up-trending over the past week, with a rise of 14.16%, but this was up by 27.27% over a month. Three-month performance dropped to -23.85% while six-month performance fell -24.44%. The stock lost -20.04% in the past year, while it has lost -30.12% so far this year. A look at the trailing 12-month EPS for ABNB yields 1.17 with Next year EPS estimates of 2.42. For the next quarter, that number is 0.44. This implies an EPS growth rate of 92.40% for this year and 28.34% for next year.

Float and Shares Shorts:

At present, 635.31 million ABNB shares are outstanding with a float of 367.17 million shares on hand for trading. On Jul 14, 2022, short shares totaled 22.43 million, which was 3.52% higher than short shares on Jun 14, 2022. In addition to Mr. Brian Chesky as the firm’s Co-Founder, CEO, Head of Community & Chairman, Mr. Nathan Blecharczyk serves as its Co-Founder, Chief Strategy Officer, Chairman of Airbnb China & Director.

Institutional Ownership:

Through their ownership of 63.18% of ABNB’s outstanding shares, institutional investors have majority control over the company. Other institutions hold 37.20% of ABNB, in contrast to 24.75% held by mutual funds. Shares owned by individuals account for 10.18%. As the largest shareholder in ABNB with 5.59% of the stake, Fidelity Management & Research Co holds 21,350,212 shares worth 21,350,212. A second-largest stockholder of ABNB, The Vanguard Group, Inc., holds 17,488,537 shares, controlling over 4.58% of the firm’s shares. Jennison Associates LLC is the third largest shareholder in ABNB, holding 15,345,417 shares or 4.01% stake. With a 3.97% stake in ABNB, the American Funds Growth Fund of Ame is the largest stakeholder. A total of 15,169,479 shares are owned by the mutual fund manager. The Vanguard Total Stock Market Index, which owns about 2.65% of ABNB stock, is the second-largest Mutual Fund holder. It holds 10,145,561 shares valued at 903.77 million. Invesco QQQ Trust holds 1.45% of the stake in ABNB, owning 5,536,636 shares worth 493.2 million.

An Overview of Recent Financials:

Understanding a company as a customer does not mean you will understand it as an investor. The wise investor uses quantitative research to analyze metrics such as revenue, net income, and earnings. In its fiscal quarter reported on Mar 30, 2022, ABNB reported revenue of $1.51B and operating income of -$4.81M. Over the past year, revenue came in at $6.61B while operating income stood at $871.13M. It generated -$18.79M net income for the quarter, which came to $801.38M over the last twelve months. The EBITDA in the recently reported quarter was $27.23M and diluted EPS was -$0.03. EBITDA for the full year was $1.01B.

Analysts Ratings:

Reading analyst opinions is an effective way to decide where to invest, and there are several opinions available for ABNB since 39 analysts follow the stock currently. There are 14 analysts who recommend BUY ratings, while 2 suggest SELL ratings. Of the remaining analysts, 20 believe that the stock is worth HOLDING, 2 give it an OVERWEIGHT rating, and 1 thinks that it’s UNDERWEIGHT. In the same way, a target price assigned to a stock can also reveal much about its potential. With ABNB analysts setting a high price target of $250.00 and a low target of $95.00, the average target price over the next 12 months is $157.61. Based on these targets, ABNB could surge 114.89% to reach the target high and fall by -18.34% to reach the target low. Reaching the average price target will result in a growth of 35.47% from current levels.

EPS: Estimates vs Actual

It is also common to use earnings estimates to evaluate a firm’s growth potential and to determine trading strategy. ABNB will report FY 2022 earnings on 02/23/2023. Analysts have provided yearly estimates in a range of $2.90 being high and $1.01 being low. For ABNB, this leads to a yearly average estimate of $1.90. The earnings surprise of a firm occurs when the actual results change from the consensus earnings estimate. Airbnb Inc. reported $0.56 EPS against a consensus estimate of $0.56. The surprise factor in the prior quarter was $0.22. Based on analyst estimates, the high estimate for the next quarter is $0.66 and the low estimate is $0.27. The average estimate for the next quarter is thus $0.45.

Summary of Insider Activity:

Insiders traded ABNB stock several times over the past three months with 26 Buys and 81 Sells. In these transactions, 89,257,481 shares were bought while 90,954,492 shares were sold. The number of buy transactions has increased to 97 while that of sell transactions has risen to 364 over the past year. The total number of shares bought during that period was 190,971,936 while 197,152,367 shares were sold.

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