Airbnb Falls 5% in a Year: Should You Buy, Sell or Hold the Stock?

Group 1: Company Performance - Airbnb's shares have declined by 4.8% over the past 12 months, underperforming the Zacks Consumer Discretionary sector's return of 11.5% and the Leisure and Recreation Services industry's appreciation of 22.7% [1] - The company anticipates margin compression in Q4, expecting margins to be between 27-28%, indicating potential near-term weakness in profitability [5] - The Zacks Consensus Estimate for Q1 2025 earnings is 26 cents per share, reflecting a year-over-year decline of 36.59%, while revenues are estimated at $2.31 billion, suggesting a 7.98% year-over-year increase but a 4.9% sequential decline from Q4 2024 [6] Group 2: Competitive Landscape - Airbnb operates in a highly competitive online travel booking market, facing strong competition from established players like Booking Holdings, Expedia, and MakeMyTrip [2] - The company also competes with platforms focusing on experiences, such as Viator, GetYourGuide, Klook, and Traveloka, which diversify travel options and attract a broader customer base [3] - Additionally, Airbnb faces competition from meta-search and listing platforms like TripAdvisor, Trivago, and Google, which is expanding its travel initiatives [4] Group 3: Earnings Performance - Airbnb has a mixed earnings surprise history, missing the Zacks Consensus Estimate in two of the last four quarters and beating it in the other two, resulting in an average surprise of 20.83% [7] - Currently, Airbnb holds a Zacks Rank 4 (Sell), suggesting that investors should avoid the stock for the time being [8]