Stocks fell on Wall Street on Friday as investors continued to shift from rising tech stocks during the COVID-19 outbreak to cyclical stocks likely to benefit from the reopening of the economy.
Next week is expected to be busy for Wall Street with the quarterly results and new economic data to be published by high profile companies.
Whichever direction the market moves, we have looked at a stock that is likely to be in demand in the coming days and a stock that may experience additional decline.
However, it should not be forgotten that our time frame only covers the next week.
Share to be purchased: Airbnb
ABNB stock has more than tripled in value since its initial public offering at $ 68. Shares closed Friday at $ 206.35, near their record highs of $ 219.88 on February 11th. At current levels, the online rental and booking platform based in San Francisco, California has a market value of approximately $ 123 billion.
We expect the positive trend in ABNB to continue in the next week and the stock to continue its climb to fresh historical peaks thanks to its status as one of the best names in the travel industry hit by the epidemic.
Revenues came at $ 859.3 million, exceeding expectations of $ 747 million, but still 22% below the amount in the same period last year. Key metrics such as reservation and room-night growth also exceeded expectations.
“Our performance has demonstrated that Airbnb is resilient and inherently adaptable,” CEO Brian Chesky said in his February 25 revenue report publication.
“Travel is returning and we are fully focused on preparing for recovery.”
While Airbnb has not provided a direction for the next quarters, the company is still in an ideal position to benefit from the expected recovery in the travel industry, thanks to the accumulated demand and growing telework trend.
Stock to be sold: DoorDash
DASH closed the Friday session at $ 169.49, about 34% below its historic high of $ 256.09 on January 27, giving the company a market cap of $ 53.8 billion.
DoorDash announced in its first revenue report, which it published as a public company, that net losses reached $ 312 million, more than doubling from the same period last year, but much of this is related to the initial public offering process last year. Revenue reached $ 970 million with an increase of 226% compared to the same period last year.
The food delivery service company warned that although demand boomed in the fourth quarter, some of the backwinds achieved by restaurant bans across the US could turn into headwinds as the restrictions end and vaccination continues across the country.
“We hope the markets will start opening soon. With reopening, we expect reductions in consumer engagement and average order sizes, but the exact volumes are still uncertain,” the company said in the revenue report publication.
DoorDash made a dismal forecast for 2021, showing growth in total order value (GOV) at an average of 27.7%, a key measure for sales. This is a very sharp slowdown compared to 227% growth in the fourth quarter.
With the anticipation for restaurants to reopen as a result of ongoing vaccinations across the country, DoorDash seems to have seen the climax already.