Preparing for take-off in 2022: 3 travel and tourism actions to watch this year

JTravel stocks are expected to generate a lot of interest during 2022. The emergence of the omicron variant shook stocks across the industry in the fourth quarter of 2021, threatening to impose large-scale travel restrictions. scale as tension spread around the world. However, optimism is now growing that 2022 could be the year we see a significant return to the holidays over the next few months.

In the United States, travel spending has fallen 42% year over year in 2020 according to the US Travel Association. International travel was even harder hit, falling 76% year-on-year. With consumers struggling to catch flights and travel across borders in recent years, it’s reasonable to expect a resurgence over the course of the year.

In the UK, the London Stock Exchange was boosted throughout January on growing investor confidence in the future of travel stocks. The FTSE 100 and FTSE 250 indices both closed higher after news broke that the UK government had planned to scrap testing for fully vaccinated travelers arriving in England from February 11. UK holiday bookings have reportedly skyrocketed in recent days, and stocks like British Airways owner IAG have reaped the benefits – gaining 7.39% and leading the index. Similarly, in hotels, Whitbread, owner of Premier Inn, added 2.36%.

Similarly, InterContinental Hotels Group was among the best performers following the easing of travel restrictions – growing 2.8%. Elsewhere on the FTSE 250 Index, airlines saw strong growth, with companies like Tui and EasyJet ending the day up more than 5%.

“Travel demand, in general, is expected to be high in 2022, but a big factor is the evolution of the pandemic, omicron and other variations,” said Maxim Manturov, head of investment advisory at Freedom. Finance Europe. “But, as many experts argue, the rapid spread of omicron, while dangerous, could give enough people what they call ‘natural immunity’ to help turn a Covid pandemic into a phase” endemic “much less severe.”

If investor optimism holds, there could be a wide range of exponentially growing travel and tourism stocks over the course of 2022. Let’s take a closer look at three stocks that hold great potential:

1. Royal Caribbean Cruises Ltd (RCL)

Royal Caribbean Cruises has already rebounded from the financial crash of early 2020 when the pandemic first took hold. Now, there’s enough optimism that the company’s shares could return to pre-pandemic levels in 2022, depending on whether or not booking volume can return to its former glories.

Available data suggests that higher levels of bookings are taking place throughout the summer months and throughout the year, and at higher prices than before the pandemic. Additionally, in the third quarter, Royal Caribbean recorded revenues of around £339 million – which is a strong improvement on the previous year’s -£25m. The adjusted loss per share also fell to £4.15 from £3.97 the year before. RCL’s fundamentals have shown steady growth in performance over every quarter in 2021. This has led to a wave of cautious optimism for the stock.

2. American Airlines Group Inc (AAL)

Although American Airlines has been hit hard by the pandemic, the company’s earnings in the third quarter of 2021 have remained relatively stable despite the emergence of omicron concerns for vacationers. AA reported revenue of $9 billion for the quarter, up approximately 20% from the second quarter of 2021. The airline also hosted 6,000 peak day departures in the fourth quarter of 2021, the holiday season having brought a wave of people making trips to the United States.

American Airlines, alongside its Northeastern alliance with JetBlue Airways, successfully added new international services to its roster in 2021, and the airline now offers flights from New York’s John F. Kennedy International Airport to Tel Aviv, Athens and Delhi. With AA clearly looking to increase its reach in 2022, it may be reasonable to expect its stock to climb as more flights are booked in the second and third quarters of this year.

Maxim Manturov notes: “American Airlines is seeing travel growth again and its third quarter revenue shows why they should be watching it in 2022. Revenue for the quarter was nearly $9 billion, an increase of 20% compared to the second quarter of last year. . The airline expects strong demand during peak travel periods in the fourth quarter. On average, they plan more than 6,000 departure days during this period. The third quarter was a good period for American Airlines, which announced an unexpected profit of $169 million.

3. Airbnb Inc (ABNB)

Going public at the end of 2020, Airbnb’s first stock market performance was affected by the ramifications of the pandemic. However, the home-sharing platform has also become one of the most popular vacation apps in the world. The company’s second-quarter financial reports indicated a strong summer, with revenue of $1.3 billion, a sharp increase from the company’s struggles in early 2021. Airbnb also says its latest Product innovations are designed to allow individuals to travel in new ways – giving customers greater freedom in where and when they travel.

For example, at the beginning of 2021, the company announced flexible dates to better spot interesting offers for customers. Recently, Airbnb also introduced the Flexible Matching and Flexible Destinations tools to help travelers explore more diverse listings and new destinations. As a leading technology platform, Airbnb may react positively to a boom in vacation bookings in the coming months. Provided skies remain clear and the outlook for Covid-19 remains positive, we could see positive performance in 2022 for the the brightest journey in the world and tourism values.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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