- Airbnb posted a robust FQ1 earnings report, but its stock fell steeply in May. In addition, we cautioned about its slowing ADR growth and steep valuation in April.
- However, the valuation reset has brought ABNB stock to more palatable levels (though not undervalued). The market has astutely priced in weakness in FY23 ahead of time.
- Our price action analysis suggests a near-term bottom, but with bear trap price action. Therefore, it could break lower lows before staging a recovery.
- Therefore, we revise our rating from Hold to Cautious Buy without a bear trap support. However, we urge investors to layer in due to potential volatility.
For further details see:
Why Did Airbnb Stock Crash In May; Can It Recover?