- Forex 40 +
Many investors have been waiting for this: the Airbnb IPO and all sorts of investors are wondering how they can buy Airbnb shares.
In the past, the start-up Airbnb, founded in 2008, really stirred up the tourism market with a business principle as simple as it was ingenious. Private individuals offer rooms or apartments as an inexpensive alternative to expensive hotels.
This not only saves the guest, but hosts also benefit. And Airbnb earns diligently with every booking.
The Airbnb IPO will take place on October 10, 2020. In the following, you can read whether it is worthwhile to buy Airbnb shares despite the Corona crisis, which forecasts can be foreseen and whether Airbnb, as a tourism company, offers investors plenty of potential and opportunities.
Although the tourism industry has suffered badly in recent months, Airbnb is venturing to go public. Here we give you a brief overview of what you should pay attention to when buying.
The following points should be considered when buying Airbnb shares:
If you want to get involved in one of the biggest IPOs of the year, consider investing in Airbnb stock. We’ll explain how to do this in the following guide on buying Airbnb shares.
To invest in stocks, you need a broker who will buy and hold the stocks for you. Choose an online broker that is free of any commissions. Also, make sure that the broker offers you deposit insurance. This is how you keep your securities and your assets under control.
Our recommendation for the best equity portfolios is ETFinance. The platform proves to be inexpensive and offers deposit protection of up to € 20,000.
When registering, various data are first requested to prevent fraud. So you need to provide and verify their name, email address, phone number and other information.
In addition, like other providers, ETFinance asks for a little financial knowledge, which you should answer responsibly. The ETFinance registration process is quick and easy.
To make purchases with your depot, you must first deposit money. There are various payment options for this, such as PayPal, instant transfer or credit card, but standard transfers are usually also possible.
ETFinance requires a minimum deposit of around € 200. So a little more patience until the money is in your deposit, and then you can start.
Click on “Account” on ETFinance. You should now be able to find your deposited money here. Now you can enter “Airbnb” in the search field, and the current Airbnb share price, forecasts and analyst opinions will open in front of you.
Once you decide and want to invest in Airbnb shares, click the “Open Trade” button. ETFinance offers you the option of setting which market development – whether positive or negative – you want to sell the Airbnb share when you buy. This can protect you against, hazardous investments.
Airbnb arranges accommodation but does not assume any legal obligations. This simple idea led to a real boom in private property rental.
According to the company, over 500 million overnight stays have been booked since it was founded in 2008 until April 2020. According to the website, over 7 million advertisements in more than 120 countries and more than 100,000 cities can be found on the portal.
At first, Airbnb was on everyone’s lips because of the exceptionally favourable conditions and a new way of going on vacation. But critical voices were not long in coming. In cities with little living space, such as the large European metropolises, apartments were misappropriated solely for renting through Airbnb.
As a result, the company had to deal with new regulations. Meanwhile, commercial providers are also brokered via Airbnb.
The Covid-19 pandemic most recently walloped the company. As a result, a massive drop in sales is expected, and the valuation has been reduced by around € 2 billion. Nevertheless, investments have been made, and the workforce is expected to be reduced by 25% at the same time.
Nonetheless, Airbnb’s IPO is eagerly awaited. Some observers even speak of hype.
The market determines the first Airbnb share price in the course of the IPO. Extremely high demand can already be seen, illustrated by the increase in the price from USD 44 to 50 to USD 56-60 per title.
The evaluation of Airbnb would thus be at 42 billion $. In 2016, Airbnb’s lenders had valued the company’s value at $ 31 billion. Therefore, the Airbnb share price target is aimed at a very ambitious valuation, despite the crisis.
If getting into the Airbnb IPO is an option, you should familiarise yourself with the company’s numbers. Income has recently fallen, but black numbers were written in the third quarter of the year, despite the corona crisis.
Airbnb’s business model is still extremely interesting for shareholders and is an option for numerous portfolios. If Airbnb can emerge stronger from the end of the pandemic and win new customers, it could see stronger profits again.
Airbnb would like to use the current positive investor sentiment. Airbnb has to invest in keeping up with the times. Thus, adopting the latest technologies such as artificial intelligence, cryptocurrencies, new authentication technologies, and others relevant to Airbnb and keeping competitive.
The money for these future-oriented investments will come from the IPO . Sounds like a possible risk investment. Should Airbnb get back on track with its IPO and experience a second spring at the end of the pandemic, significant profits seem conceivable.
The valuations of the Airbnb share and its price target seem to be relatively high at the moment, but the demand is enormous. Risky investors take advantage of this and buy Airbnb shares at the earliest possible point in time.
Conservative shareholders should first watch the price of Airbnb shares a little and closely follow the development strategies the company is pursuing. It doesn’t seem unrealistic that after a brief hype, the price slips and then makes the investment more interesting.
The forecasts of some pessimistic experts currently do not match Airbnb’s ambitious rating. Nevertheless, the demand suggests that the company will have one of the biggest IPOs of the year, which could trigger Airbnb shares to jump.
This is entire to the taste of risky investors who want to broaden their portfolio with Airbnb shares.
Even if the critics were right and the issue price was set too high, the share is a triggeringsuitable long-term investment. Because when the pandemic comes to an end, the company will have the best possible chance of making profits and continuing to grow.
An investment directly at the IPO in Airbnb might be overzealous. Nevertheless, demand has pushed the price up, which is likely to have long since sacrificed fair company value in favour of the greed of shareholders.
It could pay off to patiently watch the market and keep an eye on the Airbnb share price target in the coming weeks. Should more and more analysts soon express critical voices regarding an overvaluation, the price could also fall for the time being.
Some experts consider Airbnb’s rating to be way too high. An investment in Airbnb shares seems to be more of a risky investment right from the start. Consider which strategy you want to invest with: short buy & sells or long-term investments. Wait and access later could be worthwhile.
In the long term, it should still be worthwhile to buy Airbnb shares.
Airbnb shares were first listed on the NASDAQ stock exchange in New York in December 2020. Since then, the share can look back on some turbulent weeks and months.
The opening price of the share was $ 146 per share, well above expectations before the IPO. Due to the high level of interest in the stock, the price rose to $ 220 per share and then fell to as low as $ 121 per share. The price is now $ 201 (as of March 18, 2021).
Various factors can explain these fluctuations. After the first listing on the stock exchange, the interest in the share was extremely high, and there was hype about the share. Due to this increased demand, the Airbnb share was able to record substantial price gains. However, after the fanfare subsided, many investors decided to take profits and thus caused the share price to fall. The stock has now levelled off at around $ 200 but is still subject to significant fluctuations in some areas.
When evaluating the share, we must first and foremost consideration in which business area Airbnb is active. Airbnb arranges accommodation for short-term and long-term stays through its platform. Like the rest of the tourism sector, Airbnb suffers from travel restrictions during the corona pandemic.
Airbnb’s sales plummeted 32% in the first three quarters of 2020 compared to 2019. Global tourism also fell by 42% in 2020.
Although sales fell sharply during the pandemic, Airbnb is well-positionedUnfortunately, like for the near future. With over 4 million hosts, 7 million listings in over 220 countries and 100,000 cities, Airbnb is represented worldwide and will particularly benefit when the corona pandemic is over.
In our opinion, this is an excellent opportunity for you as an investor to invest in Airbnb. With the lifting of travel restrictions shortly, tourism will increase sharply again, and Airbnb will be one of the beneficiaries of the increasing tourism.
Airbnb shares offer investors great potential if the travel restrictions caused by the corona pandemic are lifted and more mobility returns worldwide. Thanks to the business model, Airbnb benefits to a large extent from increasing tourism and can particularly benefit from the easing of the corona measures soon.
In addition to the increasing number of overnight bookings, Airbnb can also continue to grow by expanding its product portfolio. In addition to the classic overnight stays, Airbnb now also arranges many on-site activities through the “Experiences” branch. Due to the growing interest in individual travel experiences, it is expected that this sector will continue to contribute to the company’s growth in the future.
After Airbnb’s brilliant start on the stock exchange, many investors wonder whether the stock was overvalued. This question is justified if you look at the price development of the share. With an opening price of $ 146 and a current price per share of $ 201 (as of March 18, 2021), the stock has generated a return of approximately 38% to date. Thus, an investment of $ 10,000 would have grown to $ 13,800.
But is Airbnb stock overvalued?
Some analysts find the stock is overvalued. According to these analysts, the stock is currently valued as if the best-case scenario would materialise. In this case, the best-case scenario is that the travel restrictions due to Covid-19 will be dissolved, and the tourism sector will recover in a short time. However, if there are delays, for example, with the vaccinations, the company will not achieve its sales targets, and the share price will fall.
This view can be determined using the price/sales ratio. At Airbnb, this is currently 37. For other stocks in the tourism sector, this ratio averages four. Based on this comparison, it can seem logical that Airbnb is overrated.
However, the problem with this comparison is that Airbnb is not a classic tourism company that operates hotels itself or has to hold other inventory.
Airbnb generates its income from the commissions it collects from hosts and tourists. With this business model, Airbnb has to keep comparatively little inventory and scale the business model without significant investments.
Based on this consideration, some reasons speak for an overvaluation. First, because of its unique business model, Airbnb should be compared with other companies in the tourism industry and companies that have a similar business model.
The experts’ forecasts are prettywith sceptical, and the group managed well without going public for a long time. So it will be decided in the next few weeks where the group’s journey and the Airbnb share price will go. So it will be interesting to see whether the share will live up to the company’s valuation, i.e. its Airbnb share price target for 2020 of $ 56 to $ 60 per share.
So far, the company has not released any information as to whether a dividend should be paid. In any case, if the company should make substantial profits, it is not inconceivable that this strategy should be reviewed.
An Airbnb share dividend would undoubtedly be exciting for long-term investors, as it could generate a regular dividend yield.
For long-term investors, short-term fluctuations in stocks do not play a significant role. Therefore, in this section, we offer you an outlook for Airbnb shares for the year 2025.
Tourism will have recovered from the corona pandemic shortly and will pick up speed again. With rising incomes in the emerging countries and stable revenues in the industrialised nations, tourism will continue to grow in the next few years.
Above all, companies whose business model takes place mainly in virtual space will benefit from the positive developments. Due to the high user-friendliness of the online portals, these companies will be the big winners in the tourism sector and will benefit particularly strongly from the growth in this sector.
Airbnb is one of the leading providers in accommodation brokerage and relies heavily on an excellent user experience and a wide range of offers on the platform. Especially in the growth market of individual travel with unique experiences, Airbnb has a significant lead over the competition.
With a massive selection of hosts in over 100,000 destinations, Airbnb will benefit from the increasing demand for tourism. Furthermore, by expanding the on-site offer by arranging activities at the travel destinations, Airbnb will also build up another lucrative line of business and develop positively.
Because of these points, the outlook for 2025 is positive for Airbnb enormously, and the company can therefore also be a good investment for long-term investors.
If the Airbnb share is currently too hot for you, you can alternatively invest in other accommodation shares. We present the best alternatives:
The Booking share is currently at $ 2102 and seems to be slowly but surely recovering from the Corona crisis. However, the majority of the analysts (19) recommend holding the share, 13 analysts give a buy recommendation, and only one analyst says “sell”. Thus, the uncertainty in the tourism industry is slowly decreasing, and Booking seems to be well-positioned.
We compare the fees of the largest brokers with the following example:
With these assumptions, we now compare the fees of Libertex, ETFinance & Plus500 :
|Deposit||for free||free||for free|
|Purchase fees||€ 2.20||free||3.08%|
|Holding fees||for free||free||0.05%|
|Sales charges||€ 2.20||spreads||3.08%|
|Total fees||€ 4.40||Reasonable||€ 92.32|
If you want to invest in Airbnb, we recommend buying Airbnb stock on ETFinance.
At ETFinance, you can buy a large number of stocks commission-free and have a broker with many years of experience at your side. In addition, the authorities’ easy-to-use user interface and strict regulations mean that you can trade stocks quickly and securely on ETFinance.
That’s why we recommend ETFinance for buying Airbnb shares.
Airbnb’s IPO is probably the most exciting IPO of 2020. Despite the unclear market situation and economic development, the company is daring to go public. The experts currently rate the rating too high, but this can change relatively quickly. Demand is high, and ultimately the market determines the Airbnb share price.
Investors are faced with whether the riskier route of buying Airbnb stock directly at the IPO could pay off. Instead, conservative investors are waiting and hoping for lower Airbnb share prices and a recovery in the tourism market.
Airbnb states that investments are necessary to prepare for the future. However, critics claim that they want to use the general upswing to simply make money.
An Airbnb share dividend is currently not confirmed. However, there is no telling whether the company will stick with this strategy. An Airbnb dividend could make the stock even more attractive.
Investing in the tourism industry in these times is of course doubly risky. However, Airbnb is trying to become more independent from the market. The entry could be worthwhile, but the share should not be described as safe.
We recommend buying Airbnb shares through the test winner ETFinance. The offer includes commission-free share trading, but also trading in CFDs, crypto currencies and more.
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