- Cathie Wood’s Ark Invest purchased $23.7 million in Airbnb (ABNB) shares, including 80,361 shares for $10 million, 60,068 shares on April 28, and 49,560 shares worth $13.7 million post-Q1 earnings, with the stock closing at $125.26 on Friday.
- Airbnb’s Q1 revenue rose 6% to $2.27 billion, slightly above the $2.26 billion expected, but earnings fell 42% to $0.24 per share, with a Q2 revenue forecast of $2.99 billion to $3.05 billion, below the $3.04 billion consensus.
- Despite a 22%-plus stock drop since mid-February and U.S. economic softness, Benchmark analysts lowered their price target to $155 from $178 but maintained a buy rating, aligning with Wood’s optimism for Airbnb’s growth potential.
Cathie Wood’s Ark Invest has demonstrated strong conviction in Airbnb Inc. (ABNB), acquiring $23.7 million worth of shares in recent transactions, with the stock closing at $125.26 on Friday. The purchases included 80,361 shares valued at $10 million last week, followed by 60,068 shares on April 28 and an additional 49,560 shares worth $13.7 million after Airbnb’s first-quarter earnings on May 1. Despite a 22%-plus decline from its mid-February peak, Wood’s investment signals optimism about the vacation rental platform’s long-term potential, even as it navigates economic headwinds and a modest growth outlook.
Airbnb’s Q1 results showed revenue of $2.27 billion, a 6% year-over-year increase, slightly surpassing the $2.26 billion analyst consensus, while earnings of $0.24 per share met expectations but dropped 42% from the prior year’s $0.41. The company’s guidance for the current quarter projects revenue between $2.99 billion and $3.05 billion, implying 9% to 11% growth, though the midpoint falls just shy of Wall Street’s $3.04 billion forecast. Management attributed softer U.S. performance to broader economic uncertainties, a sentiment echoed in their shareholder letter, which highlights challenges in sustaining momentum amid macroeconomic pressures.
Benchmark analysts maintained a ‘Buy’ rating on ABNB but reduced their price target from $178 to $155, citing the company’s potential to accelerate growth in the coming years despite short-term volatility. The firm views Airbnb’s trajectory as promising, suggesting that current challenges are temporary.
Wood’s recent investments, while not elevating Airbnb to a top 10 holding in the Ark Innovation ETF, align with her strategy of backing innovative companies with strong fundamentals poised for recovery. Airbnb faces competition from platforms like Booking.com and Expedia (EXPE), but its global network and brand strength position it well for expansion in international markets and new offerings like experiences. However, investor sentiment may remain cautious given the stock’s recent decline and the company’s acknowledgment of economic softness, making Wood’s bold moves a calculated bet on Airbnb’s ability to capitalize on a rebound in travel demand and operational efficiencies.
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