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There was a time when it was hard for us to imagine staying in a stranger's home but it has become a norm today. Airbnb has led the transformation of the travel industry and in less than a decade, it has become a popular name, giving strong competition to well-established hotel brands for short-term stays. Airbnb has more than 5 million hosts and more rooms than the top five biggest hotel chains combined.
No matter the destination you are planning to visit or the type of property you want to stay in, you will find it on Airbnb. Additionally, the property will come with a complete kitchen and workspace, making it more cost-efficient than a hotel. After a decade of operations across the world, Airbnb has become synonymous with travel and it is the first thing that comes to mind when looking for a place to stay. The company is expanding on all fronts and making its presence felt across the globe.
If you missed your chance of investing in the initial public offering (IPO) last year, you can still buy Airbnb stock. Let’s take a look at the three steps you need to take.
Airbnb Inc. is a publicly-traded company and the stock is available on the stock market. It can be bought by anyone keen on buying equity. The easiest way to buy stocks is through a brokerage account. You will find various brokers in the industry that offer different types of services but they all have varying fees, account minimum, and commission. You can check the different platforms and make a call. It is recommended to consider all the options before you commit to a brokerage. A few brokers allow the purchase of fractional shares so if you do not have the funds on hand, you can buy a part of the share. Let’s take a look at three brokers who are worth considering and offer Airbnb stock purchases.
Stash is a user-friendly platform that allows you to buy whole and fractions shares, bonds, and ETFs. It will not take more than 10 minutes to open an account and then you can connect it to the source of funding. You can buy any stock on Stash. It has three levels of plans for you to choose from. All the plans come with varying features. The basic plan is worth $1, then there is a $3 plan which comes with retirement accounts. The highest level plan of $9 will give you two custodial accounts so you can invest for your kids as well. It also provides monthly market insight reports. You enjoy a debit card account and a life insurance policy worth $1,000 with Stash.
Buying Airbnb stock is easy with Robinhood. It is free to signup and provides robust features with a monthly fee of $5. It also includes access to Morningstar research which can help you with stock picking. Robinhood allows the purchase of fractional shares so you can own any stock without having to arrange for a large number of funds. The stock purchase is commission-free and you are also allowed to do pre-market and after-hours trading. You can open the account for free and there is no minimum balance amount requirement.
You can open a Webull account within 10 minutes and it will allow you to claim two free stocks ranging anywhere between $2.50 to $250, but you will have to make a minimum deposit of $100 in the account. Another perk you will get is 3-month trial access to Level 2 Market Data that will help make the right investment decisions. It takes 0% commission on trades and comes with a host of benefits including powerful data analytics.
Pros and cons
Access to full extended hours trading
Does not offer fractional shares
Does not allow you to invest in all types of securities like bonds or mutual funds
Airbnb is a San Francisco-based company that operates an online marketplace for lodging. It mainly operates homestays for vacation rental. Founded in 2008 by Brian Chesky (CEO), Joe Gebbia (CPO), Nathan Blecharczyk (CSO) the platform has grown over the years and is accessible through the web and mobile application. Interestingly, Airbnb does not own any of the listed properties, it lists the properties owned by others on the portal and allows travelers to book them for their stay. The company makes profits by receiving a commission with each booking. Its original name was AirBedandBreakfast.com and Airbnb is its shortened version.
Today, Airbnb is one of the top companies in the market and many hotel chains feel the threat. By 2009, the company had 10,000 users and 2,500 listings on the platform. Airbnb has consistently grown since 2009 and has expanded across the world. It opened offices across different countries and by 2011, its investment partners included Ashton Kutcher and Guy Oseary.
The company became profitable for the first time in the second half of 2016 and Airbnb’s revenue significantly increased in 2016. It generated a profit of $200 million in 2018 and turned into losses in 2019. The company has also made several strategic alliances that allow its expansion and growth in the market.
Airbnb is listed on NASDAQ with ticker ABNB and made its debut as a public company on Dec 10, 2020. The IPO price was $68 and it raised $3.5 billion in the IPO. The stock has surged since then and saw a high of $219 in February 2021. The stock has shown volatility due to the pandemic and is currently exchanging hands at $151.
Airbnb price history
Investing in an IPO is a great opportunity to make the most of the growth of the company and Airbnb is no exception. The company has grown over the years and has grabbed a large market share. If you had invested $1,000 in Airbnb in the IPO in 2020, you would have received 14 shares at the IPO price of $68, and today, your investment in Airbnb stock would be worth $2,220, almost double the amount invested.
Airbnb dividend information
Airbnb has not paid a cash dividend at any point. It only went public last year so once the company generates profits, investors can expect a dividend. However, it will not happen soon.
Best features of Airbnb stock
Airbnb enjoys a unique business model. Airbnb has a business model that creates a new way to vacation. It offers several destination possibilities and accommodation options. Plus, it also allows homeowners to rent their property and earn extra cash. Hotel groups are already feeling the heat and seeing Airbnb as a threat. The pandemic has only increased its popularity. There was never a better time to invest in Airbnb shares than today. With several accommodation options across the world, Airbnb has become a part of many travelers' itineraries. It has competitive pricing and offers various facilities in addition to bed and breakfast.
Stellar fundamentals despite the pandemic. Airbnb reported stellar Q1 2021 results. Despite the pandemic, the revenue increased by 5% year over year and hit $887 million. With growing vaccination rates across the U.S., there will be more travel and a lot more bookings. It is expected that all states will open by the summer and things will improve significantly. Driven by the pent-up demand for vacations and the remote work flexibility, people will be willing to opt for longer stays. The change in work culture is a benefit for Airbnb as it will increase longer bookings.
High flexibility for travelers. Airbnb recently accounted for a few major upgrades to the platform and prepared for the travel rebound. With more than 100 upgrades, Airbnb made hosting and booking more flexible and convenient. It allows complete flexibility in booking the dates and destinations. Further, it also has a convenient process to become a host. These upgrades were brought about after considering the sentiments towards travel and it will allow the company to capitalize on the demand.
Ideal travel recovery stock. The lifting of Covid curbs means entering a new world of travel. People are looking to escape from the lockdown in every manner possible. They want to travel with their family and spend time with their loved ones, which they missed over the past year. Travelers are making new choices on where to travel and how to get there. The world is not the same and this means travel will not remain the same. People have become more flexible in where and when they go.
Remote work allows them to take extended weekends and travel whenever they want to. Airbnb enjoys a competitive edge over hotels as it offers entire properties equipped with a kitchen and work area. Professionals who are sick of working from home for the past year can take a few weeks away and enjoy a vacation while they work remotely at one of the Airbnb properties. Despite the hotels following strict Covid 19 protocols to attract visitors, many travelers prefer to rent private properties where they do not have to mingle with strangers or share the swimming pool.
Airbnb will benefit from remote work culture. Consumers are also heading towards small cities and towns and this is a huge change brought due to the pandemic. People are also choosing to travel outside the peak season and stay at one location for longer. This is a shift towards more meaningful travel. Airbnb saw the share of bookings longer than 28 days jump to 24% in the recent quarter from 14% in 2019. The company has also grown in valuation significantly and it will continue to do so in the coming years.
Step 3: Open a brokerage account & buy Airbnb shares
If you are ready to open an account and get into investing in Airbnb stock, you can start with Webull. When you open the account with Webull and deposit $100, you get to choose two stocks of your choice to buy and you can purchase Airbnb stock right away. Let’s take a look at what is involved in the process.
Start by going to the Webull website and click on Sign up. Here you will have to provide your email ID and password. You can register using your Email ID or mobile number. You will receive a verification code and once you verify it, you can set up the account.
Once you click on Open account, you will be asked to provide basic information. This includes details like name, address, birth date, nationality, social security number, and employment. You may also have to answer a few security questions to ensure that you are allowed to trade.
Now you need to choose the type of account you are keen on opening and the broker will verify your information and approve the application. You can review the information and agree to the terms and conditions.
It will not take more than 10 minutes to open the account. You now need to fund the account and you can do this by transferring the funds from your bank account. Start investing in stocks right away!
There are two ways you can place stock trades, one is through the limit price and the other is market price. When you choose the limit price, you get to set the price at which you want to buy the stock. Whenever the stock hits the limit price set by you, it will be purchased on your behalf. When you opt for market price, you do not get to set the price, it is purchased at the current stock price in the stock exchange.
How much were Airbnb shares when the company first went public?
Airbnb shares were priced at $68 in the IPO in 2020.
How much does it cost to buy Airbnb shares today?
It costs $151 to buy Airbnb shares today.
Does Airbnb pay dividends?
Airbnb does not pay any dividends.
What is the minimum number of Airbnb shares that I can buy?
You can buy Airbnb shares for as little as $1 depending on the brokerage you choose. It is possible to buy fractional shares.
The bottom Line
Airbnb is a well-known company that can benefit from travel recovery. If you are looking for growth stocks for long-term investment, Airbnb is a great choice. It will report impressive numbers in the coming years which will take the stock to new highs. The pandemic has worked in favor of the company. It is one stock you can buy and hold for the long term.
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