Airbnb stock price forms a double-top as insiders sell shares

Airbnb (NASDAQ: ABNB) stock price has moved sideways in the past few months as investors assess the strength of the travel industry. The shares were trading at $130 on Wednesday, a few points above this week’s low of $121.47. This price was ~15% below the highest point this year.

A key concern among investors is that the company’s insiders have been selling the stock for a while. Data compiled by Barchart shows that insiders have sold 11.25 million shares in the past 12 months. They have sold 2.04 million shares in the past three months. At the current price, the stocks sold in the past 12 months are valued at over $1.46 billion.

Insider sales are often seen as red flags because these people have inside knowledge about the company’s performance. However, in Airbnb’s case, insider sales could be aimed at reducing their ownership of the company. Data by MarketBeat shows that insiders still own about 30% of the company, which is higher than other popular companies like Meta Platforms, Apple, and Tesla.

Airbnb’s founder, Brian Chesky, has sold shares worth millions in the past few months. The most recent insider sale was Joseph Gebbia, who sold shares worth over $23.2 million. Nathan Blecharczyk, the Chief Strategy Officer recently sold shares worth over $5.3 million.

Airbnb’s business is doing well now that the travel industry is rebounding. The most recent results showed that the company’s revenue jumped by 18% to $2.5 billion in Q2 while the net income soared to $650 million. Its free cash flow rose by 13% to $900 million, which has helped the firm boost its share repurchases.

The only concern for Airbnb is that its growth is now set to moderate in the coming quarters as inflation in key countries remains at an elevated level. Its key competitors like VRBO and Booking are also taking market share.

The daily chart shows that the ABNB share price has formed a double-top pattern at around $150. In most cases, this is one of the most bearish patterns in the market. The stock is now hovering slightly above the double top’s neckline at $123.72.

The shares have also retreated below the 50-day and 100-day moving averages, signaling that bears are still in control. Therefore, the outlook for the stock is bearish for now. This view will be confirmed if the stock moves below the neckline at $123.72.

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