Airbnb Teams Up with Etsy for “Art of Hosting” Collab

Can profitability help ABNB bounce back?

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Airbnb Inc (NASDAQ:ABNB) recently announced that it was teaming up with Etsy (ETSY) to introduce a curated selection of crafted and guest-favorite home items from Etsy sellers in a project called the “Art of Hosting.” The selection, which features homemade items, aims to make it easy and affordable for new and existing Airbnb Hosts to create a guest-friendly listing with unique touches.

ABNB was last seen down 1.7% at $139.65, as it makes its way toward its fifth-consecutive daily loss. The stock has managed to find footing near the $138 level, however, which is helping to keep some distance between its current price and its May 19 annual low of $129.71. Nevertheless, the shares are down 15.7% year-to-date, and suffer a 30% 12-month deficit. 

This recent slide has attracted options bears. At the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), ABNB sports a 10-day put/call volume ratio of 1.05, which stands higher than all but 1% of annual readings. This implies long puts have rarely been more popular in the past year. 

Echoing this, ABNB's Schaeffer's put/call open interest ratio (SOIR) of 1.24 sits in the 91st percentile of its annual range. In other words, short-term options traders are targeting Airbnb puts with an unprecedented frenzy. 

Price action aside, Airbnb stock continues to have strong long-term growth potential. Although the firm suffered a 30% decline in revenues for fiscal 2020 as a result of the pandemic, its revenues are still up 46% since fiscal 2018. The vacation rental marketplace is also estimated to grow revenues another 23.7% in 2022. In addition, ABNB is expected to see a shift into profitability in 2022, with estimates placing its earnings per share (EPS) at $0.96.

Moreover, Airbnb also holds a strong balance sheet with $7.92 billion in cash and $2.43 billion in total debt, offering a great deal of security. Nonetheless, Airbnb stock could very easily continue to see significant weakness in the short-term due to its high valuation, with the stock trading at very high price-sales ratio of 21.22. However, ABNB does have a very attractive long-term outlook from a fundamental point of view.

 

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