Wednesday, August 18, 2021
Vacation News for the USA


Is Airbnb The Finest Journey Inventory As Delta Variant Surges?

BRAZIL – 2019/05/24: On this photograph illustration the Airbnb emblem is seen displayed on a smartphone. … [+] (Photograph Illustration…

By Staff , in Vacation Rentals , at August 18, 2021

View deals on Tripadvisor

Airbnb revealed a greater than anticipated set of Q2 2021 earnings final week, though the robust outcomes have been overshadowed by issues that surging Covid-19 circumstances within the U.S. may influence the corporate’s near-term efficiency.

Over Q2, Airbnb noticed its income rise by nearly 4x in comparison with final yr to $1.34 billion, with its internet loss narrowing significantly to about $68 million for the quarter. The underlying developments for the enterprise have been additionally robust, with common day by day charges for bookings rising to $161, up from $160 in Q1, and up by over 40% year-over-year. Nevertheless, the corporate struck a cautious tone with its near-term outlook. The extremely infectious delta variant of the virus that causes Covid-19 has been spreading within the U.S. and day by day circumstances within the nation have surged to ranges of round 130,000 circumstances per day presently, a fourfold improve in comparison with final month. Though Airbnb expects Q3 revenues to be its strongest ever, it has indicated that the variety of bookings for the quarter could be under that of Q2 2021, because of seasonality and issues over the present Covid-19 surge. The corporate additionally mentioned that its This autumn efficiency would rely on the progress of vaccinations and the containment of latest virus variants.

Whereas the present virus surge is regarding, we predict that Airbnb is best positioned in comparison with accommodations and different segments of the journey business to sort out an prolonged pandemic. Extra individuals are more likely to go for driving holidays, presumably to much less populated areas, whereas planning longer stays as corporations have delayed return to workplace plans. For instance, over Q2, the corporate mentioned that 19% of stays booked on its platform have been for 28 days or extra, with the quantity standing at 24% in Q1. Airbnb’s stock can also be more likely to be extra suited to social distancing, in comparison with accommodations which have many widespread areas and this might additionally play to the corporate’s favor.

We worth Airbnb inventory at about $160 per share, about 18x projected 2021 revenues. That is about 8% forward of the present market worth. Though there are cheaper methods to play the holiday rental enterprise, through the likes of Expedia which additionally owns Vrbo, a fast-growing trip rental enterprise, we predict Airbnb’s model and robust development ought to make it a prime decide within the house. See our interactive evaluation on Airbnb’s Valuation: Costly Or Low-cost? for extra particulars on Airbnb’s enterprise and comparability with friends.

[7/1/2021] Purchase Airbnb Inventory Forward Of The July Fourth Journey Growth?

Airbnb inventory (NASDAQ: ABNB) has gained about 14% from its lows of close to $134 per share seen in Could, to about $153 per share at the moment, as traders brace for an enormous upcycle within the lodge business.

The upcoming Independence Day weekend is considered as an inflection level of kinds within the U.S. journey and tourism business’s restoration from the Covid-19 pandemic. About 46% of Individuals are actually totally vaccinated towards Covid, and masks mandates have additionally been lifted in a number of vacationer locations, and this might end in important pent-up demand for journey. For perspective, the American Vehicle Affiliation expects that over 47.7 million Individuals might be touring between July 1 and July 5, with journey recovering nearly totally to the pre-pandemic ranges. It’s very seemingly that demand will stay elevated by means of the Labor Day weekend in early September as folks take advantage of the primary summer time put up the Covid lockdowns.

Now, Airbnb could be very nicely positioned to benefit from the approaching growth, as we imagine that extra folks will go for driving holidays, presumably to much less populated areas, whereas doubtlessly planning longer stays – a pattern that ought to profit vacation-sharing corporations. The corporate has additionally ready for this surge, finishing up some main upgrades to its platform in Could.

That being mentioned, we predict Airbnb inventory appears to be like a bit costly at present costs of over $150 per share, buying and selling at over 17x ahead revenues. There are cheaper methods to play the journey growth. For instance, on-line journey main Expedia which additionally owns Vrbo, a fast-growing trip rental enterprise, is valued at about $25 billion, or beneath 3x projected 2021 income. Expedia’s income development charges are additionally anticipated to be corresponding to Airbnb’s (about 60% this yr) and it’s really more likely to flip a revenue, not like Airbnb which stays within the purple. We worth Airbnb at about $120 per share, or about 15x projected 2021 income. See our interactive evaluation on Airbnb’s Valuation: Costly Or Low-cost? for extra particulars on Airbnb’s enterprise and comparability with friends.

[5/27/2021] What’s Occurring With Airbnb Inventory?

Airbnb inventory (NASDAQ: ABNB) has declined by about 25% over the past month, buying and selling at about $135 per share at the moment. Under are just a few current developments for the corporate and what it means for the inventory.

Airbnb posted a powerful set of Q1 2021 outcomes earlier this month, with revenues rising by about 5% year-over-year to $887 million, as rising vaccination charges, significantly within the U.S., led to extra journey. Nights and experiences booked on the platform have been up 13% versus the final yr, whereas the gross reserving worth per evening rose to about $160, up round 30%. The corporate can also be reducing its losses. Adjusted EBITDA improved to destructive $59 million, in comparison with destructive $334 million in Q1 2020, pushed by higher value administration and the corporate expects to interrupt even on an EBITDA foundation over Q2. Issues ought to enhance additional by means of the summer time and the remainder of the yr, pushed by pent-up demand for holidays and in addition because of rising office flexibility, which ought to make folks go for longer stays. Airbnb, particularly, stands to profit from a rise in city journey and cross-border journey, two segments the place it has historically been very robust.

Earlier this week, Airbnb unveiled some main upgrades to its platform because it prepares for what it calls “the most important journey rebound in a century.” Core enhancements embody better flexibility in trying to find reserving dates and locations and an easier onboarding course of, which makes it simpler to grow to be a bunch. These developments ought to permit the corporate to raised capitalize on recovering demand.

Though we predict Airbnb inventory is barely overvalued at present costs of $135 per share, the danger to reward profile for Airbnb has definitely improved, with the inventory now down by nearly 40% from its all-time highs seen in February. We worth the corporate at about $120 per share, or about 15x projected 2021 income. See our interactive evaluation on Airbnb’s Valuation: Costly Or Low-cost? for extra particulars on Airbnb’s enterprise and comparability with friends.

[5/10/2021] Is Airbnb Inventory A Purchase At $150?

We famous that Airbnb inventory (NASDAQ: ABNB) was costly throughout our final replace in early April when it traded at near $190 per share (see under). The inventory has corrected by roughly 20% since then and stays down by about 30% from its all-time highs, buying and selling at about $150 per share at the moment. So is Airbnb inventory enticing at present ranges? Though we nonetheless imagine valuations are wealthy, the danger to reward profile for Airbnb inventory has definitely improved. The inventory trades at about 20x consensus 2021 revenues, down from round 24x throughout our final replace. The expansion outlook additionally stays robust, with income projected to develop by over 40% this yr and by round 35% subsequent yr.

Now, the worst of the Covid-19 pandemic seems to be behind the US, with over a 3rd of the inhabitants now totally vaccinated and there may be more likely to be appreciable pent-up demand for journey. Whereas sectors equivalent to airways and accommodations ought to profit to an extent, it’s unlikely that they’ll see demand get better to pre-Covid ranges anytime quickly, as they’re fairly depending on enterprise journey which may stay subdued because the distant working pattern persists. Airbnb, then again, ought to see demand surge as leisure journey picks up, with folks choosing driving holidays to much less densely populated areas, planning longer stays. This could make Airbnb inventory a prime decide for traders seeking to play the preliminary reopening.

To make certain, a lot of the near-term motion within the inventory is more likely to be influenced by the corporate’s first quarter earnings, that are due on Thursday. Whereas the corporate’s gross bookings declined 31% year-over-year throughout the December quarter because of Covid-19 resurgence and associated lockdowns, the year-over-year decline is more likely to average in Q1. The consensus factors to a year-over-year income decline of about 15% for Q1. Now if the corporate is ready to ship a stable income beat and a stronger outlook, it’s fairly seemingly that the inventory will rally from present ranges.

See our interactive dashboard evaluation on Airbnb’s Valuation: Costly Or Low-cost? for extra particulars on Airbnb’s enterprise and our worth estimate for the corporate.

[4/6/2021] Why Airbnb Inventory Isn’t The Finest Journey Restoration Play

Airbnb (NASDAQ: ABNB) inventory is down by shut to fifteen% from its all-time highs, buying and selling at about $188 per share, because of the broader sell-off in high-growth know-how shares. Nevertheless, the outlook for Airbnb’s enterprise is definitely very robust. It appears fairly clear that the worst of the pandemic is now behind us and there may be more likely to be appreciable pent-up demand for journey. Covid-19 vaccination charges within the U.S. have been trending increased, with round 30% of the inhabitants having acquired no less than one shot, per the Bloomberg vaccine tracker. Covid-19 circumstances are additionally nicely off their highs. Now, Airbnb may have an edge over accommodations, as folks go for much less densely populated areas whereas planning longer-term stays. Airbnb’s revenues are more likely to develop by about 40% this yr, per consensus estimates. Compared, Airbnb’s income was down solely 30% in 2020.

Whereas we predict that the long-term outlook for Airbnb is compelling, given the corporate’s robust development charges and the truth that its model is synonymous with trip leases, the inventory is dear in our view. Even put up the current correction, the corporate is valued at over $113 billion, or about 24x consensus 2021 revenues. Airbnb’s gross sales are more likely to develop by about 40% this yr and by about 35% subsequent yr, per consensus estimates. There are less expensive methods to play the restoration within the journey business post-Covid. For instance, on-line journey main Expedia which additionally owns Vrbo, a fast-growing trip rental enterprise, is valued at about $25 billion, or simply about 3.3x projected 2021 income. Expedia development is definitely more likely to be stronger than Airbnb’s, with income poised to broaden by 45% in 2021 and by one other 40% in 2022 per consensus estimates.

See our interactive dashboard evaluation on Airbnb’s Valuation: Costly Or Low-cost? We break down the corporate’s revenues and present valuation and examine it with different gamers within the accommodations and on-line journey house.

[2/12/2021] Is Airbnb’s Rally Justified?

Airbnb (NASDAQ: ABNB) inventory has rallied by nearly 55% because the starting of 2021 and at the moment trades at ranges of about $216 per share. The inventory is up a stable 3x since its IPO in early December 2020. Though there hasn’t been information from the corporate to warrant features of this magnitude, there are a few different developments that seemingly helped to push the inventory increased. Firstly, sell-side protection elevated significantly in January, because the quiet interval for analysts at banks that underwrote Airbnb’s IPO ended. Over 25 analysts now cowl the inventory, up from only a couple in December. Though analyst opinion has been blended, it however has seemingly helped improve visibility and drive volumes for Airbnb. Secondly, the Covid-19 vaccine rollout is gathering momentum within the U.S., with upwards of 1.5 million doses being administered per day, and Covid-19 circumstances within the U.S. are additionally on the downtrend. This could assist the journey business finally get again to regular, with corporations equivalent to Airbnb seeing important pent-up demand.

That being mentioned, we don’t assume Airbnb’s present valuation is justified. (Associated: Airbnb’s Valuation: Costly Or Low-cost?) The corporate is valued at about $130 billion, or about 31x consensus 2021 revenues. Airbnb’s gross sales are more likely to develop by about 37% this yr. Compared, on-line journey large Expedia which additionally owns Vrbo, a rising trip rental enterprise, is valued at about $20 billion, or simply about 3x projected 2021 income. Expedia is more likely to develop income by over 50% in 2021 and by round 35% in 2022, as its enterprise recovers from the Covid-19 hunch.

[12/29/2020] Choose Airbnb Over DoorDash

Earlier this month, on-line trip platform Airbnb (NASDAQ: ABNB) – and meals supply startup DoorDash (NYSE: DASH) went public with their shares seeing massive jumps from their IPO costs. Airbnb is at the moment valued at a whopping $90 billion, whereas DoorDash is valued at about $50 billion. So how do the 2 corporations examine and which is probably going the higher decide for traders? Let’s check out the current efficiency, valuation, and outlook for the 2 corporations in additional element. Airbnb vs. DoorDash: Which Inventory Ought to You Choose?

Covid-19 Helps DoorDash’s Numbers, Hurts Airbnb

Each Airbnb and DoorDash are basically know-how platforms that join consumers and sellers of trip leases and meals, respectively. Trying purely on the fundamentals in recent times, DoorDash appears to be like just like the extra promising wager. Whereas Airbnb trades at about 20x projected 2021 Income, DoorDash trades at nearly 12.5x. DoorDash’s development has additionally been stronger, with Income development averaging about 200% per yr between 2018 and 2020 as demand for takeout soared by means of the Covid-19 pandemic. Airbnb grew Income at a median charge of about 40% previous to the pandemic, with Income more likely to drop this yr and get better to shut to 2019 ranges in 2021. DoorDash can also be more likely to put up optimistic Working Margins this yr (about 8%), as prices develop extra slowly in comparison with its surging Revenues. Whereas Airbnb’s Working Margins stood at round break-even ranges over the past two years, they’ll flip destructive this yr.

The Airbnb Story Nonetheless Has Enchantment

Nevertheless, we predict the Airbnb story has extra attraction in comparison with DoorDash, for a few causes. Firstly within the near-term, Airbnb stands to realize significantly from the top of Covid-19 with extremely efficient vaccines already being rolled out. Trip leases ought to rebound properly, and the corporate’s margins must also profit from the current value reductions that it made by means of the pandemic. DoorDash, then again, is more likely to see development average significantly, as folks begin returning to dine in eating places.

There are a few long-term elements as nicely. Airbnb’s platform scales far more simply into new markets, with the corporate’s working in about 220 international locations in comparison with DoorDash, which is a logistics-based enterprise that has to date been restricted to the usalone. Whereas DoorDash has grown to grow to be the most important meals supply participant within the U.S., with about 50% share, the competitors is intense and gamers compete totally on value. Whereas the limitations to entry to the holiday rental house are additionally low, Airbnb has important model recognition, with the corporate’s title turning into synonymous with rental vacation properties. Furthermore, most hosts even have their listings distinctive to Airbnb. Whereas rivals equivalent to Expedia need to make inroads into the market, they’ve a lot decrease visibility in comparison with Airbnb.

Total, whereas DoorDash’s monetary metrics at the moment seem stronger, with its valuation additionally showing barely extra enticing, issues may change post-Covid. Contemplating this, we imagine that Airbnb could be the higher wager for long-term traders.

[12/16/2020] Making Sense Of Airbnb Inventory’s $75 Billion Valuation

Airbnb (NASDAQ: ABNB), the web trip rental market, went public final week, with its inventory nearly doubling from its IPO worth of $68 to about $125 at the moment. This places the corporate’s valuation at about $75 billion as of Tuesday. That’s greater than Marriott – the most important lodge chain – and Hilton accommodations mixed. Does Airbnb – which has but to show a revenue – justify such a valuation? On this evaluation, we take a quick have a look at Airbnb’s enterprise mannequin, and the way its Revenues and development are trending. See our interactive dashboard evaluation for extra particulars. In our interactive dashboard evaluation on on Airbnb’s Valuation: Costly Or Low-cost? we break down the corporate’s revenues and present valuation and examine it with different gamers within the accommodations and on-line journey house. Components of the evaluation are summarized under.

How Have Airbnb’s Revenues Trended In Latest Years?

Airbnb’s enterprise mannequin is easy. The corporate’s platform connects individuals who wish to hire out their properties or spare rooms with people who find themselves in search of lodging and makes cash primarily by charging the visitor in addition to the host concerned within the reserving a separate service payment. The variety of Nights and Experiences Booked on Airbnb’s platform has risen from 186 million in 2017 to 327 million in 2019, with Gross Bookings hovering from round $21 billion in 2017 to about $38 billion in 2019. The portion of Gross Bookings that Airbnb acknowledges as Income rose from $2.6 billion in 2017 to round $4.8 billion in 2019. Nevertheless, the quantity is more likely to fall sharply in 2020 as Covid-19 has harm the holiday rental market, with whole Income more likely to fall by about 30% year-over-year. But, with vaccines being rolled out in developed markets, issues are more likely to begin returning to regular from 2021. Airbnb’s massive stock and inexpensive costs ought to make sure that demand rebounds sharply. We undertaking that Revenues may stand at about $4.5 billion in 2021.

Making Sense Of Airbnb’s $80 Billion Valuation

Airbnb was valued at about $75 billion as of Tuesday’s shut, translating right into a P/S a number of of about 16.5x our projected 2021 Revenues for the corporate. For perspective, Reserving Holdings – among the many most worthwhile on-line journey brokers – traded at about 6x Income in 2019, whereas Expedia traded at 1.3x and Marriott – the most important lodge chain – was valued at about 2.4x gross sales previous to the pandemic. Furthermore, Airbnb stays deeply loss-making, with Working Margins standing at -16% in 2019, versus 35% for Reserving and seven.5% for Expedia. Nevertheless, the Airbnb story nonetheless has attraction.

Firstly, development has been and is more likely to stay, robust. Airbnb’s Income has grown at over 40% annually over the past 3 years, in comparison with ranges of about 12% for Expedia and Reserving Holdings. Though Covid-19 has hit the corporate arduous this yr, Airbnb ought to proceed to develop at excessive double-digit development charges within the coming years as nicely. The corporate estimates its whole addressable market at about $3.4 trillion, together with $1.8 trillion for short-term stays, $210 billion for long-term stays, and $1.4 trillion for experiences.

Secondly, Airbnb’s asset-light mannequin must also assist its profitability in the long term. Whereas the corporate’s variable prices stood at about 25% of Income in 2019 (for a 75% gross margin) fastened working prices equivalent to Gross sales and advertising (about 34% of Revenues) and product growth (20% of Income) at the moment stay excessive. As Revenues proceed to develop post-Covid, fastened value absorption ought to enhance, serving to profitability. Furthermore, the corporate has additionally trimmed its value base by means of Covid-19, because it laid off a couple of quarter of its employees and shed non-core operations and it’s doable that mixed with the potential of a powerful Restoration in 2021, income ought to lookup.

That mentioned, a 16.5x ahead Income a number of is excessive for an organization within the on-line journey enterprise. And there are dangers together with potential regulatory hurdles in massive markets and opposed occasions in properties booked through its platform. Competitors can also be mounting. Whereas Airbnb’s model is powerful and customarily synonymous with short-term residential leases, the limitations to entry within the house aren’t too excessive, with the likes of Reserving.com and Agoda launching their very own trip rental platforms. Contemplating its excessive valuation and dangers, we predict Airbnb might want to execute very nicely to easily justify its present valuation, not to mention drive additional returns.

Need publicity to the rising digitization of the financial system by means of and put up Covid-19? Try our theme on Web Infrastructure SharesSee all Trefis Featured Analyses and Obtain Trefis Information right here



Source link

Comments