Airbnb dips after Wells Fargo warns results could lag expectations
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Airbnb (NASDAQ:ABNB) fell in early trading on Thursday after Wells Fargo began coverage on the online travel stock with an Underweight rating.
Analyst Ken Gawrelski and team said they believe it makes sense to introduce new products to combat ADR inflation, but do not expect 'Rooms' to prove meaningful lift for the overall business.
"While we would view re-acceleration of share gains as a result of lower ADRs positively, we don't believe Street '24 or '25 incremental margin expectations of 44% and 50% reflect the impact of lower pricing / higher competitive intensity."
Wells Fargo has 2024 and 2025 EBITDA estimates on Airbnb (ABNB) about 5% and 11% below consensus. The firm's view around incremental margin of lower ADR supply and pricing initiatives. Moderating share gains vs. hotels and persistent regulatory risk creates are said to create tough dynamic for investors to hold onto sector-leading EBITDA trading multiples.
On Seeking Alpha, analysts are mixed on Airbnb (ABNB) with Strong Buy, Hold, and Sell ratings all being doled within the last four weeks.
Wells Fargo assigned a price target of $99 to ABNB.
Shares of Airbnb (ABNB) shed 1.05% in late morning trading to $115.35 vs. the 52-week trading range of $81.91 to $144.63
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