Submitted by MunkyR8 t3_yikig8 in wallstreetbets
Airbnb, we all know it, we all have used it in the past (when it was cool). But now, if you have traveled any within the last year or two, you know that fees are tearing this company apart. It used to be cheaper to rent an airbnb compared to a hotel for the longest time. No one liked going to hotels and they were actually disrupting the hotel industry. But now, with all of the service fees, and CLEANING fees which are sometimes 100-110% of the nightly rate.
For example, here is a nightly rental in Scottsdale, AZ. For $151 a night, I pay $139 cleaning fee and $41 service fee. So after fees, you are paying effectively a 119% premium on your rental just to stay somewhere other than a hotel. Who would do that? and why? Not to mention you have to clean the place yourself, and basically do the home maker's job, because if you don't your rep gets hit. Its an absolute joke of a company now.
So then after looking into maybe I am just biased because I hate paying these people to make me clean, I did a simple google trends search. Searches for "airbnb" on google actually peaked the first week of this previous quarter in July. And since then have been plummeting to nearly Dec lows. So maybe its inflation, maybe its fees, who knows but this can't be good for bookings.
YTD chart of \"airbnb\" searches
5 year chart of \"airbnb\" searches. Headed back to covid lows.
But then I do some more searching and I find this. Hosts are obv struggling to get bookings. Maybe its because your fees are insane!
So then I started I got my crayola crayons out and started looking at the chart. The chart has been in an obvious downturn since November 2021. We are in a pretty significant downtrend, and have been consolidating since the drop in December. Looking at this chart I would expect this flag we are in currently to snap to the downside and make a new leg down which would put us near $80 a share again. Which I feel is an appropriate value given the environment we are in.
Once I put my crayons up, I wanted to check and see what company directors and insiders have been doing with the stock considering we are near all time lows. You would think if the market for bookings and travel was expected to "pick up" given countries opening back up (Japan, Canada, etc.) that these insiders would be picking up stock at these cheap prices. Well... was I surprised. Joseph Gebbia (co founder of Airbnb) was holding 2.75M shares at the beginning of Q3. He has no sold off 1.5M shares since the start of Q3, effectively cutting his position in half. FIFTY percent less than he had at the start. Sounds like someone has a confidence issue in his company's ability to disrupt the hotel industry.
Airbnb has been unable to manage fees like they have promised. They promised to "look into it". Nothing has changed, inflation has been destroying lower income families preventing people from taking vacations, and when they do, they are forced to go the cheaper hotel route option again. Which at the end of the day, you have less expectations as a guest, no cleaning, and sometimes even free breakfast. I am taking puts for these earnings tomorrow after close.
I am holding $90 P 11/4 and $80 P 11/4. Wish me luck fellow regards. I have convinced myself this is the beginning of the end of Airbnb. Good bye.
Edited: Earnings tomorrow after close, not AM