Latest news with #C.PatrickScholes
Yahoo
3 days ago
- Business
- Yahoo
Airbnb shares dip as Truist cuts stock to Sell on weak summer trends, valuation
-- Shares in Airbnb Inc (NASDAQ:ABNB) fell roughly 2% at market open Friday after Truist Securities downgraded the stock to Sell from Hold due to soft summer leisure trends and concerns over valuation. The brokerage also cut its price target to $106 from $112, warning that both U.S. and European demand appear weaker than investors currently anticipate. 'We believe soft summer leisure trends, both for the U.S. and Europe (difficult y/y comp in Europe due to last summer's events) are not being fully anticipated by analysts and investors,' Truist analysts led by C. Patrick Scholes said in a note. They also flagged valuation as a headwind, noting they 'do not believe the premium valuation multiple vs. other not too dissimilar asset-lite hospitality companies such as Hilton (NYSE:HLT) is fully deserved.' Truist's downgrade is part of a broader recalibration of expectations across the lodging sector, as analysts lower their 2025 Revenue per Available Room (RevPAR) forecasts. The broker sees third-quarter RevPAR down 3% to 1% for U.S. mid and upper-end hotels, below consensus estimates of flat growth. Limited service hotels are expected to perform worse, with RevPAR seen falling between 4% and 2%. The analysts cite a combination of weaker consumer and business confidence, cuts in government travel, and reduced inbound international demand as key factors behind the softer booking trends. While the softness isn't considered severe, Truist said RevPAR is tracking roughly 150 basis points below current Street expectations for the third quarter. 'To be clear, the softness we observe is not anywhere near the demand collapse like what occurred during Covid nor is it GFC-esque but rather RevPAR growth for 3Q and into 4Q simply looks 'soft' to the tune of approx. 150 bps. below current Street expectations,' the analysts explained. Park Hotels & Resorts (NYSE:PK) was also downgraded to Hold from Buy, due to its high leisure exposure—especially in Hawaii—and elevated leverage. Truist said tourism expectations in Hawaii have deteriorated, with the University of Hawaii Economic Research Organization noting that weakness is 'primarily due to actual and threatened U.S. tariff hikes that are much larger than anticipated, as well as adverse effects on increased federal policy uncertainty around trade, immigration, spending and tax cuts.' Despite a stable trend in average daily rates (ADR), Truist warned that the industry's historical tendency to cut prices to stimulate demand during periods of weakness could return if softness continues. Related articles Airbnb shares dip as Truist cuts stock to Sell on weak summer trends, valuation AGCO downgraded as Citi says risk/reward now more balanced Sanofi, Regeneron shares nosedive after mixed Itepekimab results Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
CNBC
3 days ago
- Business
- CNBC
Stocks making the biggest moves premarket: Ulta Beauty, Airbnb, Gap, American Eagle
Check out the companies making headlines before the bell. UiPath — Shares surged 12% after the automation software company posted first-quarter operating income and revenue figures that exceeded FactSet estimates. UiPath also raised its full-year revenue guidance and sees its current-quarter revenue coming in between $345 million to $350 million, while analysts polled by FactSet were expecting $331.3 million. Ulta Beauty — The beauty retailer's shares rallied 9% after the firm raised its annual profit forecast and crushed expectations with its quarterly results. Ulta said lower inventory losses as well as new launches — especially celebrity-owned brands — helped drive demand at its stores. American Eagle — Shares slumped 7% after the clothing retailer reported a fiscal first-quarter adjusted loss of 29 cents per share, which was wider than an LSEG estimate for a loss of 22 cents per share. American Eagle's $1.09 billion revenue came in as expected. Gap — The apparel retailer plunged 13% after it forecast sales to be flat for its current quarter, while analysts had expected growth of 0.2%. This lackluster guidance overshadowed Gap's first-quarter earnings and revenue beat. Elastic NV — Shares stumbled 10% after the American-Dutch software company guided for full-year revenue in the range of $1.655 billion to $1.67 billion. This missed the FactSet consensus outlook of $1.68 billion. Marvell Technology — The chip stock slipped 4% after first-quarter results came in roughly in line with expectations. Marvell Technology's shares were up 9% in May ahead of the report. Adjusted earnings per share were 62 cents, just a tick ahead of the 61-cent estimate from analysts, according to LSEG. NetApp — The data infrastructure stock shed 5% after forecasting its fiscal first-quarter adjusted earnings to come in the range of $1.48 to $1.58, while analysts polled by FactSet forecast $1.65 per share. However, NetApp posted an earnings and revenue beat for its last quarter. Regeneron Pharmaceuticals , Sanofi — Biopharma stocks Regeneron Pharmaceuticals and Sanofi respectively tumbled 10% and 4% after reporting mixed results in late-stage trials for a respiratory drug called itepekimab they are developing together. Airbnb — Shares slipped 3% after Truist Securities downgraded the short-term vacation home rental company to a sell rating from hold. Analyst C. Patrick Scholes said that investors haven't fully accounted for soft summer leisure trends, both in the U.S. and Europe. PagerDuty — The cloud computing stock fell 5% after PagerDuty forecast that its second-quarter guidance would come in between 19 cents and 20 cents per share, excluding items. This was lower than the profit guidance of 23 cents per share analysts polled by FactSet had penciled in. Zscaler — Shares rose 6% after the cloud security company topped analysts' expectations for its fiscal third-quarter, and raised its full-year earnings and revenue guidance. Zscaler earned 84 cents on an adjusted basis in the third quarter, better than the FactSet consensus estimate for 76 cents per share. Revenue of $678 million exceeded the $666.5 million estimate. — CNBC's Yun Li, Sarah Min and Jesse Pound contributed reporting.
