Airbnb Surpasses Estimates, Earns $0.98 EPS in Q2 2023

Credit Suisse's Stephen Ju raised their price target on Airbnb (NASDAQ: ABNB) by 10% from $150 to $165 on 2023/08/04. The analyst maintained their Hold rating on the stock.

Ju's rating comes after Airbnb outperformed Credit Suisse's revenue and adjusted EBITDA estimates for Q2 2023. The company's earnings report, released on August 3, revealed several positive trends that contributed to its success.

According to the report, Airbnb reported earnings per share (EPS) of $0.98 for Q2 2023, surpassing the Zacks Consensus Estimate by 27.27%. This figure also represented a significant increase of 75% compared to Q2 2022's EPS of $0.56. Additionally, the company's revenue of $2.48 billion exceeded the Zacks Consensus Estimate by 2.81% and demonstrated an 18.1% growth compared to Q2 2022's revenue of $2.8 billion.

The report also highlighted some key performance metrics for Q2 2023. Airbnb reported an adjusted EBITDA margin of 44%, indicating an improvement from the previous quarter's margin of 34%. The company recorded 115.1 million nights and experiences booked, representing an 11% year-over-year increase. Furthermore, Airbnb's gross booking value (GBV) reached $19.1 billion, marking a 13% year-over-year growth.

Looking ahead to Q3 2023, Airbnb's management provided guidance indicating further growth. The company expects revenue in the range of $3.3 billion to $3.4 billion, implying a 14% to 18% year-over-year growth rate. Management also anticipates that revenue growth will outpace the growth in nights and experiences booked. Additionally, Airbnb aims to increase its adjusted EBITDA margin from Q3 2022's 51%.

During the earnings call, Airbnb's Chairman, CEO, and Co-Founder Brian Chesky expressed optimism about the company's performance. He highlighted three positive business trends: strong guest demand, guests traveling farther, and guests staying longer on Airbnb. Chesky emphasized that active bookers grew in every region, cross-border nights booked increased by 16% compared to a year ago, and millions of people remained flexible in their living and working arrangements.

In addition to Stephen Ju's rating, other analysts also updated their price targets for Airbnb on August 4, 2023. Colin Sebastian from Baird raised their price target by 16.7% to $120 and maintained a Hold rating. Mario Lu from Barclays raised their price target by 3.7% to $136 and also maintained a Hold rating. James Lee from Mizuho raised their price target by 3.4% to $145, while also maintaining a Hold rating.

Currently, 38.9% of top-rated analysts rate ABNB as a Strong Buy or Buy, while 50% consider it a Hold. A small percentage, 11.1%, either recommend or strongly recommend selling the stock.

The consensus forecast among analysts suggests that ABNB will deliver earnings per share (EPS) of $3.83 in the upcoming year. If this prediction holds true, it would represent a 6.3% increase on a year-over-year basis.

Since Airbnb's latest quarterly report on August 3, 2023, the stock price has experienced a slight decline of 0.5%. However, on a year-over-year basis, the stock has shown significant growth, with a gain of 17.6%. During this period, Airbnb has outperformed the S&P 500, which has increased by 7.9%.

Stephen Ju, the analyst behind the rating, is ranked in the top 1% of 4,288 Wall Street analysts by WallStreetZen. They have an impressive average return of 8.7% and a win rate of 52.4%. Ju specializes in sectors such as Consumer Cyclical and Industrials.

Airbnb, Inc., headquartered in San Francisco, California, operates a platform that connects hosts and guests worldwide. The company facilitates the booking of spaces and experiences through its online marketplace model. Airbnb primarily offers private rooms, primary homes, or vacation homes. Originally known as AirBed & Breakfast, Inc., the company changed its name to Airbnb, Inc. in November 2010. Airbnb, Inc. was founded in 2007 and continues to be a major player in the hospitality industry.

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