With a pandemic about to lock down global travel, the much-anticipated December 2020 Airbnb IPO was destined for a stormy start. And after a short-lived initial spike, ABNB stock went into an extended slump beginning in early 2021.
But the San Francisco-based firm continues to make good on its promise to disrupt the travel industry and is now packing up its bags to set forth on a new breakout adventure. The improved outlook has lifted Airbnb onto the IBD Breakout Stocks Index. Airline stocks United Airlines. Alaska Air and Copa have also landed on this stock screen.
With a nearly perfect 98 Composite Rating, Airbnb is second only to Booking in the Travel Booking industry . The group ranks a solid No. 35 out of the 197 industries IBD tracks.
As airline stocks like UAL and cruise lines like Royal Caribbean continue their rise, Airbnb stock has made a reservation of its own to take advantage of the resurgent travel sector.
See Who Joins Airbnb The IBD Breakout Stocks Index
Airbnb Stock, Booking Lead Travel Booking Industry
Powering the revival in travel, Airbnb, Booking, Trip.com and MakeMyTrip have all fueled resurging earnings growth recently.
As shown in MarketSmith, Airbnb posted 500% EPS growth to 48 cents a share in Q4. To kick off the new year, the company followed that up with a 700% gain in Q1. Although that was compared to the prior-year quarter that showed a loss, it highlights the strength of the rebound.
First-quarter revenue came in at $1.82 billion, a year-over-year gain of 20% but a fifth-straight quarterly slowdown. Yet, Airbnb noted that net income was $117 million — its first profitable Q1 on a GAAP basis.
| Company | Symbol | Comp Rating | EPS Rating | RS Rating | SMR Rating | A/D Rating |
|---|---|---|---|---|---|---|
| Booking | BKNG | 99 | 73 | 93 | A | D- |
| Airbnb | ABNB | 98 | 80 | 84 | A | B |
| Trip.com | TCOM | 97 | 78 | 77 | C | B |
| Expedia | EXPE | 91 | 62 | 73 | B | B- |
| MakeMyTrip | MMYT | 78 | 73 | 37 | B | B- |
Airbnb Expands Its Hospitality Across The U.S.
Since its humble beginnings in 2007 when two hosts welcomed three guests to their San Francisco home, Airbnb has since grown to over 4 million hosts who have welcomed 1.4 billion guest arrivals in almost every country across the globe.
Highlighting its impressive footprint just within the U.S., the company notes that two-thirds of U.S. Census tracts* are home to Airbnb listings. but no hotels. In these spots, Airbnb's hosts are the primary — if not the only — providers of local accommodation and drivers of local tourism. As a result, hosts and guests emerge as key drivers of economic activity in areas not served by traditional hospitality.
Emphasizing that point, Airbnb stressed that in 2022 more than $10.5 billion has been earned by U.S. hosts in areas with no hotels. Since the pandemic began, over 2,100 U.S. cities and towns have received their first Airbnb booking.
*Census Tracts are small, relatively permanent statistical subdivisions of a county or statistically equivalent entity that can be updated by local participants before each decennial census as part of the Census Bureau's Participant Statistical Areas Program.
Airbnb Stock Looks To Book A Breakout
Showing its rebounding technical strength, Airbnb saw its 50-day moving average cross back above its 200-day line in March. Since then, ABNB stock has continued to work on an early stage cup pattern showing a 144.63 buy point. Several days of above-average volume in the right side of the base point to demand.
Last week, the 21-day exponential moving average climbed above the longer-term 50-day line — another sign of strengthening technical action.
The relative strength line has slipped while the current chart pattern has formed, but has shown signs of perking up.
As the market indexes digest recent gains and look to set up a continued run, see if Airbnb stock can keep riding the rebounding travel sector and book a room in a new buy zone.
IBD Breakout Opportunities ETF
The IBD Breakout Opportunities ETF from Innovator Capital Management tracks the IBD Breakout Stocks Index. As with other index ETFs, this fund allows you to invest in the entire index in addition to, or rather than, buying individual stocks. Learn more here about the ETF and Innovator funds.
Follow Matthew Galgani on Twitter at @IBD_MGalgani.
