San Francisco-based home-sharing network Airbnb (NASDAQ:ABNB) has fresh fiscal results that should quell any skeptic’s concerns. Yet, ABNB stock recently pulled back to a crucial buy zone, leaving investors with a terrific opportunity.
Over the past year, anytime the Airbnb share price came down into the $130s or $140s, it recovered fairly quickly. Within a short span of time, the stock would bounce to the $170s and sometimes even higher. As ABNB stock pulls back into the buy zone again, there’s no guarantee that it will rebound. However, recently issued fiscal results suggest that Airbnb deserves a positive re-rating on Wall Street.
Impressively, during 2022’s first quarter, Airbnb’s gross booking value (GBV) catapulted 67% year-over-year (YOY) to $17.2 billion. GBV is an essential metric for Airbnb, so we’re already off to a great start. It gets even better from there, though. Believe it or not, Airbnb’s revenue jumped 70% YOY to $1.5 billion. Plus, the company achieved its first positive first-quarter adjusted EBITDA, coming in at $229 million.
On top of all that, Airbnb recorded a net earnings loss of $19 million. Now, you might be wondering why this would be considered good news. It’s because Airbnb’s net loss narrowed considerably compared to the year-earlier quarter’s net loss of $1.2 billion. Also encouraging is Airbnb’s second-quarter 2022 revenue outlook, which is in the range of $2.03 billion to $2.13 billion. This exceeds the average analyst’s estimate of $1.97 billion via Bloomberg.
Perhaps these eye-opening figures are driven by Americans unleashing pent-up travel demand. Airbnb’s Chief Executive Officer Brian Chesky seems to concur with this idea, saying, “U.S. domestic demand this year has so far outpaced our internal expectations and we are encouraged by U.S. international bookings exceeding 2019 levels.” Chesky also observes a “travel rebound that started last year” and sees “consumer confidence to travel [remaining] strong beyond the summer months.” In other words, positive trends in the travel market should continue to benefit Airbnb for a while.
So, don’t hesitate to buy ABNB stock while it’s near the bottom of its range. The data and Chesky’s confidence support a bullish thesis for travel in general and for Airbnb in particular.
On the date of publication, David Moadel did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
