ABNB At Price Support Zone, Right Time To Buy?
Airbnb (ABNB) should be on your watchlist. Here is why – it is currently trading in the support zone ($118.41 – $130.87), levels from which it has bounced meaningfully before. In the last 10 years, the stock received buying interest at this level 10 times and subsequently went on to generate 27.6% in average peak returns.
| Peak Return | Days to Peak Return | |
|---|---|---|
| 12/15/2020 | 73.8% | 58 |
| 8/2/2022 | 9.0% | 43 |
| 1/27/2023 | 20.3% | 20 |
| 4/17/2023 | 9.4% | 22 |
| 6/2/2023 | 29.9% | 56 |
| 8/21/2023 | 19.0% | 22 |
| 10/20/2023 | 44.4% | 153 |
| 8/14/2024 | 26.8% | 85 |
| 12/18/2024 | 26.6% | 58 |
| 4/9/2025 | 17.2% | 110 |
But is the price action enough alone? It certainly helps if the fundamentals check out. For ABNB Read Buy or Sell ABNB Stock to see how convincing this buy opportunity might be.
Here are some quick data points:
- Revenue Growth: 9.7% LTM and 19.6% last 3 year average.
- Cash Generation: Nearly 39.0% free cash flow margin and 22.2% operating margin LTM.
- Recent Revenue Shocks: The minnimum annual revenue growth in last 3 years for ABNB was 9.7%.
- Valuation: ABNB trades at a PE multiple of 32.4
- Opportunity vs S&P: Compared to S&P, you get higher valuation, higher revenue growth, and better margins
Airbnb provides a platform connecting hosts and guests worldwide to book stays and experiences online or via mobile devices.
| ABNB | S&P Median | |
|---|---|---|
| Sector | Consumer Discretionary | – |
| Industry | Hotels, Resorts & Cruise Lines | – |
| PE Ratio | 32.4 | 23.5 |
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| LTM* Revenue Growth | 9.7% | 5.0% |
| 3Y Average Annual Revenue Growth | 19.6% | 5.8% |
| Min Annual Revenue Growth Last 3Y | 9.7% | -0.3% |
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| LTM* Operating Margin | 22.2% | 18.8% |
| 3Y Average Operating Margin | 19.9% | 17.7% |
| LTM* Free Cash Flow Margin | 39.0% | 13.2% |
*LTM: Last Twelve Months
That is one way to look at stocks. Trefis High Quality Portfolio evaluates much more, and is designed to reduce stock-specific risk while giving upside exposure
What Is Stock-Specific Risk If The Market Crashes?
That said, Airbnb isn’t immune to serious pullbacks. During the Covid pandemic, it dropped about 39%, and in the inflation shock, it plunged over 61%. Even with strong fundamentals, these dips show the stock can still take a hit when markets turn volatile. Quality matters, but significant sell-offs can still hurt, no matter how solid the company looks.
But the risk is not limited to major market crashes. Stocks fall even when markets are in good shape – think events like earnings, business updates, outlook changes. Read ABNB Dip Buyer Analyses to see how the stock has recovered from sharp dips in the past.
The Trefis High Quality (HQ) Portfolio, with a collection of 30 stocks, has a track record of comfortably outperforming its benchmark that includes all 3 – the S&P 500, S&P mid-cap, and Russell 2000 indices. Why is that? As a group, HQ Portfolio stocks provided better returns with less risk versus the benchmark index; less of a roller-coaster ride, as evident in HQ Portfolio performance metrics.