Note 1) I am an amateur investor. That should tell you all you need to know.
I have been looking over ABNB for a while now. When it went public I remember one of the especially prestigious Tech gurus saying they would love to have it but that the valuation was simply ridiculous. I took her/his/whatever word for it. But that was then and this is now.
In baseball if you get called out via a third strike without swinging they call that “Caught Looking”.
https://www.google.com/url?sa=t&rct=j&q=&esrc=s&…
Thats exactly what happened to me today with ABNB
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Airbnb, Inc
Everybody knows what ABNB is and what it does.
A Few Data Points:
Current Price: $103.51
Range: 92.09 - 212.58
About 51% Below its High
About 12.4% Above its Low
Market Cap: $61B Give or Take
EV/Revenue: 8.94
YTD Momentum: -40.6%
Here are ABNB’s last 4 QTRS of Revenue Growth:
Most Recent First: +70.13%; +78.3; 67.2%; +300%
Everybody also knows that the Pandemic severely impacted the company.
Note 2: My interest in ABNB has little to do with those numbers.
ABNB last reported on May 3 with FQ1 2022 and the CC Transcript is here:
https://seekingalpha.com/article/4506566-airbnb-inc-s-abnb-c…
Here is the headline and market reaction subsequent to the report:
https://seekingalpha.com/news/3831469-airbnb-pops-after-sale…
Here are a few Highlights:
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The company reported that gross booking value soared 67% to $17.2B from a year ago.
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Revenue was up 70% to $1.5B. The company said the strong revenue growth was driven by the combination of growth in Nights and Experiences Booked, and continued strength in ADR, despite the ongoing pandemic, the war in Ukraine, and macroeconomic headwinds.
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Adjusted EBITDA was positive at $229M vs. -$59M in 2021 and -$248M in 2019.
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Long-term stays more than doubled and were at a record high.
Note 3) My interest in ABNB has little to do with those numbers.
Commentary from the Conference Call:
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We exceeded 100 million Nights and Experiences Booked for the first time ever. GBV was $17 billion, which was 73% above Q1 2019. Revenue was $1.5 billion, exceeding Q1, 2019 by 80%. Net loss was $19 million. Now this is a significant improvement in the same periods from 2018 and 2021. Adjusted EBITDA was $229 million.
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Now, this is our first positive adjusted EBITDA Q1, and this represented adjusted EBITDA margin of a positive 15%. Now this is compared to a negative 7% a year ago, and a negative 30% in Q1 2019. And finally, we generated $1.2 billion of free cash flow in the quarter.
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This was also an all-time high. And what these results show is that two years into the pandemic, Airbnb is stronger than ever before.
Now, why is this? Well, millions of people are now more flexible about where they live and they work. And as a result, they’re spreading out to thousands of towns and cities. And they’re staying for weeks, months, or even entire seasons at a time. That’s through our adaptability innovation, we’ve been able to quickly respond to this changing world of travel. And these incredible results were driven by a number of positive business trends.
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First, guests are booking more than ever before. In Q1 gross nights booked grew 32% compared to Q1 2019. And this is despite the pandemic, the war in Ukraine, and macroeconomic headwinds.
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Second, guests are returning to cities and they’re crossing borders.
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Third, guest are also staying longer, even living on Airbnb. Now, while short-term stays rebounded strongly in Q1 2022, stays of a month or longer continue to be our fastest-growing category by tripling compared to 2019. In nearly half of our nights booked in Q1 were for stays of week or longer in one in five nights booked were for stays of a month or longer.
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Now fourth, our innovations are inspiring guests to discover thousands of new places. In 2021, we delivered more than 150 upgrades across every aspect of our service. And among these upgrades was the innovative I’m Flexible feature. Now I’m Flexible feature has now been used more than 2 billion times, 2 billion
Now…no doubt that perhaps ABNB might be a really good investment from here:
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It’s Summer Vacation Time
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Covid Restrictions have been eased
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People are weary of being at home
And for all those reasons it is highly likely that the next QTR or two will be rip-roaring successes for the company - with perhaps two small fly thingys in the ointment: Inflation and Recession. So…once again you have to consider the odds and place your bets accordingly.
Note 4) My interest in ABNB has nothing to do with any of these great statements.
What I honed in on was the stock movement. Now, don’t get me wrong, I am not a chart guy and couldn’t tell the difference between a Loping Camel and a Wounded Buffalo. I am just looking at it for a replacement Trading Block company since MELI has went lame. Thats it…although, quite a few of the services I follow recommend it and so there’s that to consider. Moreover, while I admit my math skills suck I firmly believe that if ABNB is to dominate the rental home market it is a much better investing candidate now than it was at $212 per share. All of which means if I placed a Scout Team TB in ABNB and it wasn’t productive I could just wait it out. Seems reasonable. So here is what I saw:
On June 14th the stock dropped to a low of $97.20 then the next day popped back up to a High of just over $103. If you were quick, and observant, and had some cojones that would be a quick gain of +5.96%.
Then on June 16th it dropped to a low of $92.09 before bouncing right back to a High of $100.61 on June 17th the very next day. That would have represented a quick gain of +9.25%.
I thought to myself - well, as far as I can tell the $100 level must be some sort of support (Note - a really good argument that I have no idea what I am doing might fit well at this point.
But then - On June 23 it dropped to a low of $93.02 and closed at $95.72. And that is where and when I got “Caught Looking”. I hesitated - trying to calculate the odds - ran out of time during AH trading and decided that if it didn’t pop higher today I would go ahead and give it a shot. Unfortunately, I was distracted at the Open where I still could have got it at around $97. But I just didn’t. And of course ABNB closed at $103.51.
Perhaps the ABNB Merry-Go-Round will come this way again - but even if it does I might not have the same feeling about it. So today might be the day I will always remember as the day I almost caught ABNB for a quick 10% TBlock.
https://www.google.com/url?sa=t&rct=j&q=&esrc=s&…
Or in my case - ABNB.
Got “Caught Looking”. Simple as that.
All the Best,