Airbnb IPO could be the steal of the century if people keep switching from hotels to homes, Jim Cramer says
Airbnb’s upcoming stock-market debut could be a once-in-a-lifetime deal, “Mad Money” host Jim Cramer said on his Monday show.
“Thanks to COVID-19, Airbnb is now the safest way to travel, which is why this IPO might end up being the steal of the century,” he said.
The home-sharing platform will benefit from people’s fear of staying in hotels, face less resistance from embattled hotel chains, and attract more users as people rent out their homes for extra cash and travelers look for bargains, Cramer argued.
“This turns out to be another one of those forever-changed businesses that’s actually benefiting from COVID-19,” he added.
Cramer’s comments suggest Airbnb’s recent troubles will be temporary.
CEO Brian Chesky warned in May that revenues were on track to tumble more than 50% this year, spurring him to cut costs, raise $2 billion in fresh capital, and lay off 1,900 employees or 25% of Airbnb’s global workforce.
Airbnb’s bookings have rebounded since then, but were still down 30% in June compared to the same month last year, Bloomberg reported. Moreover, revenue slumped 67% year-on-year to $335 million last quarter, resulting in a $400 million loss before interest, tax, depreciation, and amortization, Bloomberg said.