Airbnb Stock: Is It A Buy Or Sell? Here's What Fundamentals, ABNB Stock Chart Action Say

Airbnb stock has both dazzled and intrigued investors in growth stocks since its Nasdaq debut in December 2020. From its initial public offering price of $68 per share, ABNB stock soared as much as 223%, hitting an all-time high of 219.94 on Feb. 11, 2021.

In 2021, the travel industry faced the challenge posed by multiple strains of Covid-19, including the delta and omicron variants. And the start of 2022 has not made travel much easier. Staffing shortages at airlines and the extremely high infection rate of omicron discouraged some travel. Yet in many countries, quarantine requirements are loosening. Fewer tests are being required.

Russia's attack on Ukraine is obviously a factor to watch in terms of the potential impact on travel in that specific region. More business travelers, meanwhile, say they are feeling more comfortable about flying again.

Overall, that's good news Airbnb (ABNB), whose shares have begun a new rebound in recent weeks. But the stock continues to get hammered.

ABNB shares have lost their gains and more following a positive fourth-quarter report. One highlight? Airbnb posted a net profit of 8 cents a share vs. a new loss of 58 cents during the coronavirus-plagued quarter in 2020. The positive earnings also crushed Wall Street's view for 4 cents. Revenue ripped 78% higher to $1.53 billion, accelerating from a 67% jump in the third quarter of 2021.

Full-year revenue grew 77% to a record $5.99 billion.

On Wednesday, CFRA announced it's keeping a $215 price target. The investment bank also boosted its fiscal 2022 earnings estimate to $1.33 a share from 76 cents and the 2023 forecast to $2.21 from $1.16. The Street's current consensus forecast: $1.37 a share for 2022 vs. a net loss of 57 cents last year, and $2.03 for 2023.

Clearly, ABNB was in base-building mode, but now is simply struggle to bottom.

On Feb. 9, Airbnb bullishly crossed back the 50-day moving average. It also jumped back above the longer-term 200-day moving average, which is rising slightly. But two weeks ago, the stock again lost support at these key technical levels.

These chart-analysis tools trace, on a daily chart, a stock's price trend over the past 50 and 200 trading sessions, respectively. In a way, last week's 11% slide wasn't surprising, given that ABNB had blasted as much as 42% from its near-term low of 134.37.

The new rebound off a late-January low of 134 briefly pushed the megacap leisure and travel play's market value back above $110 billion.

So, is Airbnb stock a buy now? Or is it time lock in profits and sell?

This story analyzes all facets of the innovator in leisure travel in terms of fundamentals, technicals and mutual fund ownership. All of these elements get inputted into CAN SLIM, IBD's research-driven seven-point paradigm for successful growth stock investing.

Strong And Stunning Q4 Results

The San Francisco-based firm's disruptive business model: Allow house and condo owners turn their properties into short-term rentals. The idea has hatched plenty of competitors. Even large hotel chains offer similar properties in addition to their standard lodging accommodations.

The company chalked up 73.4 million total nights and experienced booked in the fourth quarter of 2021, jumping 59% vs. a year ago. And gross booking value of $11.3 billion  jumped 91%, up 93% excluding currency exchange effects. Airbnb posted net income of $55 million, translating into after-tax margin of 3.6%. Free cash flow hit $376 million.

On the Feb. 23 episode of IBD Live on Zoom, Jason Thomson, portfolio manager at O'Neil Capital Management, noted that millennials' desire to travel in large groups and desire to make last-minute plans make the Airbnb offering especially attractive. And that has not gone unnoticed by the major hotel chains.

Airbnb ended the year with $8.3 billion of cash, cash equivalents and marketable securities.

"We have millions of Airbnb hosts who offer nearly every type of home in nearly every community around the world," the company wrote in a Q4 news release. Executives also noted that guests are "discovering thousands of small towns and rural communities on Airbnb" while also returning to cities. Gross nights booked at urban locales accelerated vs. Q3 and "have nearly recovered to Q4 2019 levels."

Total diluted shares outstanding 681 million shares at the end of the fourth quarter. MarketSmith data currently shows ABNB with 635 million shares outstanding.

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