Shares of Airbnb (ABNB) fell in Monday morning trading as an IPO lock-up period expired, releasing millions of shares from selling restrictions. The expiration of the lock-up period comes two trading days after Airbnb reported quarterly earnings last Thursday.
EARNINGS: On May 13, Airbnb posted a ($1.95) per share loss for the first quarter, though its revenue of $886.94M was up 5% year-over-year. Analysts expected a loss of ($1.19) on revenue of $714.41M. During the period, Airbnb guests booked 64.4 million nights and experiences, representing a year-over-year increase of 13%. Gross booking value increased 52% to $10.3B. "More than a year after the start of the pandemic, Airbnb's business has continued to prove highly resilient, with strength in North America, domestic travel, nearby travel, and long-term stays," the company stated.
Looking ahead, Airbnb said in its Q1 investor letter than it expects Q2 revenue to be "significantly higher" than the year-ago period. It added that "In the near-term, we anticipate that year-over-year comparisons for Nights and Experiences Booked and GBV will continue to be volatile and unreliable measures of the steady-state growth of our business. This is due to the significant increase in cancellations that we experienced in Q2 2020 and changes in the historically more predictable booking patterns."
Airbnb further said it has seen improving trends in April relative to March in both Nights and Experiences Booked and GBV.
LOCK-UP EXPIRATION: Shares of Airbnb are down from their opening price of $146 that was seen when the company came public on December 10, 2020. The lock-up period, or the window of time when insiders are not allowed to sell the stock, has lifted as of May 17. According to Airbnb’s S-1 filing, the lockup expiration was set for “the opening of trading on the second trading day immediately following our public release of earnings for the second quarter following the most recent period.”
POST-EARNINGS COMMENTARY: Jefferies analyst Brent Thill said Airbnb "delivered another solid print," with gross bookings, revenue, profitability and directional guidance that came in better than expected. While he lowered his price target on Airbnb to $190 from $210, and argues that "near term the stock is in a holding pattern under the overhang of final lock-up expiration," Thill keeps a Buy rating on the shares as he views Airbnb as still "the best asset in travel."
Meanwhile, Baird analyst Colin Sebastian lowered the firm's price target on Airbnb to $200 from $210 and noted market rotation and lock-up expiration have pressure the shares but he continues to like the company after it reported better than expected Q1 results. He said all signs point to a fast recovery in travel and recreation and the company continues to gain market share.
PRICE ACTION: In morning trading, shares of Airbnb are down 7% to $131.99.
Airbnb
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