Airbnb was upgraded to overweight from equal weight by KeyBanc analysts led by Justin Patterson, who described the stock as a “deal on summer travel.” The company set a price target of $180 per share, which is nearly 24% higher than Monday’s closing price of $145.49.
“Our upgrade is predicated on favorable market conditions and the persistence of direct traffic advantages, which we believe creates an upward bias to Street estimates,” the analysts wrote in a note published on Monday.
While other travel companies must pay large sums of money to sites such as Google for digital advertising, KeyBanc claims that 90 percent of Airbnb’s traffic comes directly from its own website and app.
The note stated that “AirbnB’s direct traffic advantage and minimal reliance on paid marketing insulates the Company from [third-party] ad inflation.”
“In an inflationary ad market, we believe Airbnb has a new catalyst that investors can focus on: the extent to which direct traffic creates a unit economics advantage,” the analysts continued.
Furthermore, KeyBanc analysts believe the travel market is steadily recovering, which should boost Airbnb’s booking volume.
EVs & hydrogen
Capital goods firms, according to BofA, are “critical enablers” in a market worth $2.3 trillion by 2025, owing to EU proposals to cut greenhouse gas emissions by 55% by 2030. According to a July 22 research note from BofA’s analysts led by Alexander Virgo, such companies are “at the heart of the energy transition,” manufacturing products involved in electric vehicle charging, energy efficiency for buildings, and hydrogen production.
“Three of the top five markets by size appear to be direct customer markets of capital goods companies – HVAC [heating, ventilation, and air conditioning], Smart Grid, and Wind, with Smart Homes being the fastest growing market,” the analysts added.
“There are a few explicit targets in the EU plan to which capital goods companies are directly exposed, most notably the commitment that 3% of public sector buildings should be refurbished every year to drive the overall shift to more efficient buildings, the commitment to EV charging capability every 60km of road, and the explicit commitments to hydrogen production capacity over the coming years.” Green hydrogen is created by splitting water into hydrogen and oxygen using renewable electricity.
Among the buy-rated stocks recommended by BofA are:
Reduced energy consumption, increased demand for more efficient lighting systems, and an increase in the demand for remote monitoring are all expected to benefit stocks such as heavy equipment maker ABB, industrial firm Siemens, and electricity company Rexel. Signify, a manufacturer of internet-connected lighting systems, is also expected to benefit, according to BofA.
Hydrogen and renewable energy
Firms involved in wind energy, the hydrogen supply chain, and energy storage, such as cable company Nexans, wind turbine manufacturer Vestas, and renewables firm Siemens Energy, stand to benefit from the EU’s proposals.
Vehicles that run on electricity
Analysts believe that companies involved in EV charging, battery construction, and rail will benefit from the EU’s plan. Atlas Copco was chosen for its role in electric battery construction, braking systems company Knorr-Bremse was chosen for its electric-powered underground mining trucks, and Sandvik was chosen for its electric-powered underground mining trucks. ABB and Siemens were also mentioned by BofA for their roles in EV charging infrastructure.