According to data from the S&P Global Market Intelligence, shares of Airbnb fell 46.5% during the first half of this year. The stock is down 58% from its peak in late 2021.

It’s been a hard year for this kind of stock, the high-growth rich valued stocks. This can be seen in how the S&P 500 was 21% down from its all-time high and the Nasdaq composite 31% in the same way.

What’s happening

It may be confusing to see Airbnb performing this way, especially now that the travel economy has reopened and that the “high season” is on.

The main reason behind the decline in the stock is the fact that it was too expensive.

After its debut as a publicly-traded company in late 2020, Airbnb is being affected by the decisions taken by the US Federal Reserve.

With the US Federal Reserve climbing interest rates trying to beat down inflation, high-development stocks have been in retreat. Higher interest rates lower the present value of risk assets like stocks.

It’s been a harsh first half of 2022, the worst first-half year in over 50 years. However, Airbnb’s lofty decay resets the stock back to a significantly more “reasonable” valuation. Shares as of now exchange for 21 times following year free income and 34 times current year anticipated profit.