Airbnb Inc (NASDAQ:ABNB, ETR:6Z1) is expected to report better-than-expected fourth-quarter results after the travel industry experienced strong demand in November and December.
Average daily rates (ADR), a measurement of how much hosts charge guests, have remained “healthy” since the accommodation provider issued guidance in early November.
Analysts at Bank of America believe there could be some upside to these estimates when the group reports fourth-quarter results on Tuesday.
ADR forecasts have been lifted from US$154 to US$155, while the US bank also lifted its bookings to revenues estimates to US$15.4 billion/US$2.18 billion against the consensus of US$15.1 billion/US$2.16 billion.
Underlying earnings guidance from Bank of America is set at US$651 million, around US$6 million higher than market consensus.
“[We] see upside potential on marketing savings as Vrbo competition was limited in 4Q and travel conditions were healthy,” experts at the bank said.
Looking towards the 2024 financial year, Bank of America is again ahead of Wall Street estimates, with revenue guidance ahead by US$200,000 at US$2.08 billion.
Underlying earnings predictions have been kept in line with market consensus.
Despite the strong financial standing of Airbnb, Bank of America is concerned about a potential deceleration in the industry in 2024 and the group’s valuation premium compared to peers.
Therefore, it rates the stock ‘neutral’, targeting a US$155 share price target, representing little to no premium on its current price.