Investors have lost faith in Airbnb’s model, trader says with stock down nearly 40% from highs


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Shares of Airbnb are down 36% from their February highs heading into the holiday rental firm’s earnings announcement after Thursday’s closing bell. It would be the firm’s second report since going public in December.

With the shares falling 3.5% to round $135 in Thursday’s buying and selling session, there’s restricted hope for a rebound, TradingEvaluation.com founder Todd Gordon advised CNBC.

“If we make new lows, it’s never good,” Gordon mentioned in a Thursday interview with CNBC’s “Trading Nation” after Airbnb broke beneath the $138 help degree he was watching.

Still, with 20% share of the U.S. lodging market, Airbnb is “bigger than the top five hotel brands combined” and thus positioned nicely to capitalize on pent-up journey demand, Gordon mentioned.

“Once this housing market loosens back up, pent-up demand eases, supply chain issues calm, more rooms will become available,” he mentioned.

Airbnb’s gross bookings declined by roughly a 3rd in 2020.

“I think those problems are transitory and I think people will reemerge in this market,” Gordon mentioned. “I’m bullish. I’d like to see technical support, a little evidence of a reversal, before getting in, but I wouldn’t give up on this yet.”

Another trader wasn’t so certain.

“Competition is really becoming a problem for Airbnb,” Boris Schlossberg, managing director of FX technique at BK Asset Management, mentioned in the identical “Trading Nation” interview.

“VRBO is really giving Airbnb a run for its money, mainly because Airbnb has a much larger inventory in the urban core and VRBO is much, much better positioned in the vacation rental propert[ies], which is where most people want to go,” he mentioned.

Airbnb’s charges are additionally beginning to deter customers and cause them to different choices, Schlossberg mentioned.

“I think what’s happening with Airbnb, the swan dive in the price, is that it’s lost the imagination of Wall Street,” he mentioned. “Wall Street has kind of lost faith in its model at this point and I think it’s going to be very tough going for the company going forward.”

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