Hospitality company Airbnb (ABNB) is gaining share in the travel space with its high-quality marketplace of private or shared accommodation. Moreover, the company’s strong network is leading to a rise in hosts and repeat bookers. Notably, listings on the platform are nearing 6 million worldwide.
Additionally, during the pandemic, Airbnb was able to successfully “experiment” with lower marketing expenditures, drawing significant customers at a lower cost than before. This reflects the company’s ability to be operationally flexible and withstand troughs.
Expert’s Take
Airbnb announced its Q3 results on November 4, a record quarter with 70% year-on-year growth in revenues fueled by a solid recovery in travel activities. The impressive print led Needham analyst Bernie McTernan to reiterate a Buy rating on Airbnb and raise his price target to $210 from $200.
Speaking of his bullish stance on the company’s prospects, McTernan said that he is encouraged by the rebound in travel. He also noted that Airbnb is favorably positioned to capitalize on new use cases and new travel destinations, on the back of uptrends in 4Q such as Thanksgiving bookings.
“We are bullish on the potential for a steeper profitability trajectory post-pandemic relative to marketplace peers,” said McTernan.
Furthermore, touching upon the low-cost customer-acquisition “experiment” once again, the analyst is also positive about continued margin expansion by Airbnb, if the company incorporates this model into its business.
Turning to Wall Street, the analyst consensus, however, is cautiously optimistic about Airbnb, with a Moderate Buy rating based on 17 Buys, 11 Holds, and one Sell. The average Airbnb price target of $191.89 indicates a downside potential of 7.4%.
Website Traffic Trends
Additionally, there is also a trend that we found with the help of TipRanks’ website traffic tool. We observed that total unique visits to Airbnb’s website from all devices dropped 6.1% sequentially in Q3 to 218 million. However, the share price rose 13% over that same period.
When we compared the 2021 year-to-date period to the same period in 2020, we noticed that unique visits to the company’s website jumped 11.2%.
However, going by the Q3 performance, we can safely say that the sequential drop in website traffic did not affect the fundamentals of the company, which is reflected in the year-to-date growth in virtual visitors.
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Disclosure: At the time of publication, Chandrima Sanyal did not have a position in any of the securities mentioned in this article.Disclaimer: The information contained in this article represents the views and opinion of the writer only, and not the views or opinion of TipRanks or its affiliates, and should be considered for informational purposes only. TipRanks makes no warranties about the completeness, accuracy or reliability of such information. Nothing in this article should be taken as a recommendation or solicitation to purchase or sell securities. Nothing in the article constitutes legal, professional, investment and/or financial advice and/or takes into account the specific needs and/or requirements of an individual, nor does any information in the article constitute a comprehensive or complete statement of the matters or subject discussed therein. TipRanks and its affiliates disclaim all liability or responsibility with respect to the content of the article, and any action taken upon the information in the article is at your own and sole risk. The link to this article does not constitute an endorsement or recommendation by TipRanks or its affiliates. Past performance is not indicative of future results, prices or performance.