3 Travel Stocks That Could Take Off This Summer
It’s been a funny old year for the travel industry. On one hand, we’ve seen crazy demand following two years of lockdowns and restrictions. On the other, we are seeing surging costs of travel due to supply chain issues and certain geopolitical events that have shaken the commodity markets. But which stocks could take off this summer? Read on to find out. We’ll also update you on the key fundamental events of the week.
The hottest travel stocks right now
#1 Walt Disney Holdings (DIS)
You may have heard of this one.
DIS stock has declined rapidly over the past few weeks after some well-publicised political controversy and concerns around the growth of streaming firms.
So, why is this stock hot right now? Well, earnings estimates are in Disney’s favour. The company expects to grow its earnings per share to $4.44 in 2022, that’s a year-over-year increase of more than 91%.
The current stock price, plus that entirely attainable EPS (there is a full summer season ahead, of course), makes the potential gains here very appealing to many investors.
Unlike others on our list, Disney has two major positives going for it:
● First, it’s a very diverse stock, covering media networks, physical locations, studio entertainment (Star Wars, Marvel… franchise), and consumer products. So, investors are effectively hedging.
● Second, it’s not as drastically impacted by the war in Ukraine as most of its physical locations are in the US.
Definitely one to watch!
Source: Google
#2 Expedia Group, Inc. (EXPE)
This one doesn’t really need an introduction either, but here it is anyway… Expedia is one of the biggest travel firms on the planet. At the end of 2020, it boasted 3 million properties. 800,000 hotels, and had 500 airline companies are available on its platform. It also operates in over 200 countries. So yeah, it’s BIG-big!
Like many in the industry, Q1 was one to forget for Expedia. Shares dropped 14% at the beginning of May as the company failed to hit key revenue targets, reporting gross bookings of $24.41 billion, compared to Wall Street’s expected $25.89 billion.
However, whilst Omicron, Ukraine and high-inflation may well have deterred people from booking their jolly holidays in Q1. Many industry experts expect that this may now pick-up.
Having shed almost 40% of it’s stock price in 2022 already, some investors understandably see the current dip as a perfect moment to pounce.
Source: Google
#3 Airbnb (ABNB)
Flexible work arrangements and an increase in international travel due to the easing of virus restrictions may help the real-estate and experience booking firm have a nice uptick in fortunes this year.
Q1 2022 was incredible for the company as it saw a 70% year-over-year revenue growth to $1.5 billion. That’s a very nice turnaround from the $1.2 billion loss that Airbnb experienced last year.
Shares in the company dropped 11% in April, but the wider S&P500 experienced a similar (8.8%) dip, so analysts put this down to general uncertainty in the markets.
The summer looks very promising for Airbnb and that current stock dip may just be the perfect opportunity to buy.
Source: Google
Did we miss one?
What do you think of our list? Let us know what stocks you think will have a better summer and why by tweeting us at @_contentworks.
Top fundamental events this week
It’s a fairly quiet week, this week. Here are all the events to look out for.
Monday
No major events are planned.
Tuesday
● GBP — S&P Global/CIPS Manufacturing PMI Flash (MAY); S&P Global/CIPS UK Services PMI Flash (MAY)
Wednesday
● NZD — RBNZ Press Conference
● USD — Durable Goods Orders MoM (APR); FOMC Minutes
Thursday
● USD — GDP Growth Rate QoQ 2nd Est (Q1)
Friday
● USD — Core PCE Price Index YoY (APR); PCE Price Index YoY (APR); Michigan Consumer Sentiment Final (MAY)
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Speak soon!
The Contentworks team
