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Airbnb stock forecast as home rentals rise amid a rebound in vacation travel

On Friday, shares of Airbnb Inc. (NASDAQ: ABNB) jumped more than 11% after the announcement of its latest quarterly results. The company on Thursday released its third quarter earnings and profits after markets closed, beating consensus on Street’s expectations. Airbnb’s quarterly income and profits hit their highest level ever amid rising rental housing.

The company posted FQ3 GAAP earnings per share of $ 1.22, beating the average analyst estimate of $ 0.70, while revenue for the quarter increased 67.2% from same quarter in 2020 to hit a record $ 2.24 billion, beating the consensus for Street’s estimate of $ 180 million.

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The company expects growth to continue in the fourth quarter as travel restrictions continue to be lifted around the world.

Is it safe to buy Airbnb shares?

From an investment perspective, Airbnb stocks trade at a high forward price-to-earnings ratio of 444.61, making the stock less attractive to bargain hunters.

Additionally, despite its record third quarter revenue and earnings, analysts expect its bottom line to drop more than 566% in full year 2020, before rebounding 132% year-round. next.

However, given the company’s sizable third quarter earnings, it could significantly exceed expectations in the coming quarters.

Moreover, its long-term outlook looks extremely exciting as vacation travel rebounds from the negative economic effects of Covid-19.

Source – TradingView

Technically, Airbnb shares appear to have recently risen to complete a bullish breakout of an ascending channel formation. As a result, the stock sank deep into overbought conditions, creating a perfect opportunity for a pullback.

Therefore, investors might be targeting short-term withdrawals at around $ 186.18, or lower at $ 167.25, while $ 216.07 and $ 234.34 are crucial areas of resistance.

Another exciting long-term purchase?

In summary, while the recent surge in Airbnb’s share price seems to have created an exciting short-selling opportunity for short-term investors, its long-term outlook is still compelling.

Hence, it could still be a magnificent purchase for those who wish to ignore its hefty price tag.

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