If you look at a chart of Airbnb stock over the last couple of months, it appears that the stock has not done very much. It's trading right around where it was in mid-January

At first glance, that makes no sense at all. We are on the verge of what is expected to be an explosion in travel as more people get vaccinated and feel comfortable traveling once again. You'd expect shares of a premier travel company like Airbnb Inc. (NASDAQ: ABNB) would be surging right now.

Other travel-related companies like Trip Advisor Inc. (NASDAQ: TRIP) and Expedia Group Inc. (NASDAQ: EXPE) have exploded higher in anticipation of all the travel dollars that will come gushing in as America reopens. Trip Advisor is up 67% on the year.

Why hasn't Airbnb stock exploded as well?

What's Going on with Airbnb Stock

The short answer: Shares of Airbnb already exploded.

Those fortunate few who got IPO shares have made 156% on their initial investment already. The stock doubled on the first day of trading.

We saw some more gains when Airbnb released its first earnings report with better-than-expected results in February. Since then, the stock has been somewhat range-bound.

There is a significant chance that the travel surge is already priced into shares of Airbnb.

Airbnb has the early mover advantage on alternative travel accommodations. It has spent over a decade doing all the blocking and tackling to put together a network of hosts worldwide that none of its competitors can match.

From one apartment in San Francisco back in 2007, Airbnb has grown into a global network of over 4 million hosts worldwide. Its network of hosts can offer rentals in 220 countries and 100,000 cities.

No competing alternative accommodations company can even come close.

As long as Airbnb recognizes the importance of growing that hosting network, it will dominate this travel market segment for a very long time.

The question is, what is that worth?

Right now, Airbnb is unprofitable. It will be unprofitable next year as well. Analysts are hoping that it does a little over $6 billion in revenue next year. The current market cap is over $70 billion.

More than 10 times next year's hoped-for revenue is a big number.

As we get closer to a level of vaccination that allows for the full return of leisure travel, we could see Airbnb stock respond with a move higher in spite of the premium valuation.

Revenue surprises in the earnings reports due out for the rest of the year could ignite a spark under the stock as well.

So could a higher-than-expected number of hosts being added to the network.

As long as the news stories are talking about the fast-arriving explosion of travel, there is a chance this stock could catch traders' interest and move higher.

Of course, it could fall too.

Why Airbnb Is Still a Risky Buy

If anything goes wrong with the best-case scenario, this stock will get hammered.

If we fall short of the level of vaccination needed to create herd immunity and travel remains limited, the stock will see aggressive selling.

If a vaccine-resistant version of the virus develops and causes more shutdowns, Airbnb will see waves of selling in its stock.

Airbnb's success could end up hurting it as Amazon.com Inc. (NASDAQ: AMZN), Alphabet Inc. (NASDAQ: GOOGL), Alibaba Group Holding Ltd. (NYSE: BABA), and Facebook Inc. (NASDAQ: FB) represent deep-pocketed potential competitors that already have massive lists of potential hosts and customers.

Then there's regulation.

Cities all over the United States are discussing regulations that would limit Airbnb's ability to offer short-term rentals in popular vacation destinations.

If you are looking to buy Airbnb as a long-term hold, this is probably not the time or price to do so.

The good news appears to be priced into the stock already. Although only IPO buyers have benefitted from the stock's enormous move, the stock still moved much higher than the original price.

The vaccines were already rolling out when the IPO was done in December. That knowledge added to the company's excitement and helped drive the prices up to where they are today.

Airbnb could be a fantastic growth stock, but you can overpay for even the best companies. Today's price looks like too high a level.

If you are looking to play it strictly as a short-term travel play, you can buy the stock on a break back above the 20-day moving average at around $182.

Use a very tight stop.

The stock could get a strong, story-driven run if the vaccine process continues to go well. Trading breakouts for the rest of 2021 could be a profitable strategy.