Airbnb Inc ABNB has direct traffic and unit cost advantages versus peers, which could help the company improve earnings in 2021 and 2022, lending upside to the stock, according to KeyBanc Capital Markets.
The Airbnb Analyst: Justin Patterson upgraded the rating for Airbnb from Sector Weight to Overweight, while keeping the price target unchanged at $180.
The Airbnb Thesis: Favorable market conditions and the company’s direct traffic advantages have created “an upward bias to Street estimates,” Patterson said in the upgrade note.
“Data from AirDNA and our Key First Look (KFL) Data set point to steady improvements in U.S. ADRs and gross booking volume. Flowing ADR strength into our model, we project 2Q bookings of $11.4B (2% above the Street) and EBITDA of $136M (materially above the Street),” the analyst wrote.
“Unit economics advantages are about to become apparent. ~90% of Airbnb's traffic comes direct to the site/app, and the Company spends substantially less than peers in digital advertising channels,” he added.
ABNB Price Action: Shares of Airbnb had declined by 0.96% to $144.09 at the time of publication Tuesday.
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