Step Aside DoorDash: Airbnb’s Market Cap Hits $114.8 Billion

Shares of Airbnb [$ABNB] went flying nearly 143% in its first day as a public company.

The stock opened at $146 and touched a high of $165. This powerful showing comes after Airbnb raised a cool 3.5 billion on Wednesday. The home sharing network sold 51,551,723 Class A shares at $68 each. The $68 price is above the $56 to $60 price range the company set earlier this week, and higher than prior conjecture of $44 to $50. Goldman Sachs and Morgan Stanley are the lead underwriters on the deal, including 37 other investment banks. At $3.5 billion, Airbnb’s IPO is the third largest IPO of 2020, even surpassing the $3.4 billion raised by DoorDash [$DASH] on Tuesday. [Airbnb & DoorDash to IPO via ‘Hybrid Auction’]

Airbnb refrained from sending its executives to ring the bell at the Nasdaq. Alternatively, the company prepared a film of hosts from around the world ringing their doorbells to open the market. Neat huh? Established in 2008 by Brian Chesky, Joe Gebbia, and Nathan Blecharczyk, Airbnb provides an online home sharing platform that lets consumers rent out their apartments or houses for short or long periods. The Bay Area start-up was hit hard by the pandy, causing demand for short-term rentals to decline. That motivated Airbnb to pivot into longer-term residential listings in April.

It’s clearly not a hotel business, but not a SaaS firm either. However, Airbnb is a tech firm and highly “disruptive.” The firm has a greater share of employees with an engineering background than Amazon or Uber.

This blueprint appeared to have worked. Airbnb’s business model boomeranged as guests took trips closer to home and stays lengthened to more than just a few days. In the quarter ending on September 30, Airbnb had a profit of $219 million, even as revenue dropped 18%. Costs and expenses declined 35% in the quarter. [Airbnb IPO: The Hype is Real]

Needless to say. the pandy has modified the environment for travel in a positive way for Airbnb and the home sharing segment, according to Jared Shojaian, director and senior analyst, gaming & lodging, at Wolfe Research, who handed Airbnb with an Outperform rating and a $135 year-end 2021 target.

In 2021, there will be more Airbnb users in the U.S. than people in California.

But . . . Who Really Owns DoorDash? 🤔

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