Airbnb Inc. (NASDAQ: ABNB) has confirmed that it will release its fiscal Q4 2021 earnings results on Tuesday, February 15, 2022, before the market opens.
What to look for: Rebound in travel is expected to have boosted performance in Q4 2021 as the company has been garnering momentum among guests and hosts across various markets. This will be a big positive for the company. Performance during the quarter is expected to have benefited from improving momentum across EMAE, Latin America and North America. In addition, the COVID-19 pandemic and growing remote working have encouraged people to travel conveniently, and the flexibility in travel has benefited Airbnb bookings. However, the uncertainties about the pandemic have been a concern, and the emergence of variants of concerns increased booking cancellations in Q4 2021.
Earnings: Stockearning’s Estimated EPS is expected to be $0.05 per share, suggesting a 100.5% year over year increase considering in Q4 2020, the company had a loss of $10.84 per share. In the third quarter, the company reported EPS of $1.22, a share an earnings surprise of 45.24%. Historical EPS performance indicates that the company has, in the past 12 quarters, topped estimates twice (50%) and missed (50%).
Revenue: For the fourth quarter, the company anticipates revenue to be between $1.46 billion, and if the company hits this target, it will have grown its revenue by 69.8% YoY. The company had gross bookings of $11.9 billion in the third quarter.
Stock movement: ARBN shares have dropped 6.7% since the company released its third-quarter earnings. Interestingly, ARBN shares have been UP 4 times out of the past four quarters. So, the historical price reaction suggests a 100% probability of the share price going UP following the fiscal Q4 2021 earnings release. According to the Stockearning algorithm, the predicted first-day move is +/-7%, while the predicted move on the seventh day is +/-3%.
What analysts are saying: BTIG analyst Jake Fuller downgraded the stock from Buy to Hold. If projections fall and growth slows, Fuller is concerned about consensus estimates and the long-term viability of multiples. The analyst goes on to say that the ARBN's post-Omicron forecasts are "ambitious," especially in Q2 when he expects single-digit revenue growth against a difficult comp. The analyst warns investors in a research note that the viability of the company's double-digit revenue multiple is in doubt at a period when growth equities in his portfolio have pulled back to mid-single-digit multiples.
Gordon analyst Robert Mollins downgraded the stock from Buy to Hold and also cut his price target from $216 to $172. According to Mollins, there are hurdles to the ARBN's growth, and there aren't adequate upside catalysts. In a research note, Mollins assures investors that while the company will be the most resilient company in online travel for the near future, its counterparts will see "much larger" total book value growth compared to pre-pandemic levels. In addition, because the omicron-related challenges didn't appear till the second half of December, the analyst expects an increased likelihood of a "significant downward revenue adjustment in Q1.
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