The San Francisco based rental platform conducted its much anticipated Initial Public Offering this afternoon. As investors signaled high demand, AirBnB (ABNB) has already stepped out of their originally planned IPO price range of $56 - $60, issuing shares at $68 a piece.
Due to continuing high buying pressure AirBnB opened at $146, more than double its initial issuing price. The initial spike wore off throughout the day, leading to a small decline in price. By going public, AirBnB was able to raise $3.5 billion amids a record year for IPOs, putting the company in a comfortable position, anticipating vaccine approvals and increasing travel demand.
The optimism on Wall Street pleased investors, but future developments will depend on how the house-sharing provider will deal with regulatory constraints as seen in latest policy developments in Portugal. Moreover, AirBnB will have to prove its long-term profitability after net losses of $697 million during the first 9 months of 2020.