Should Investors Buy These Travel Stocks Right Now?
Travel stocks have undoubtedly been among the losing sectors of the stock market during the height of the pandemic. But now, thanks to strong vaccination efforts and easing travel restrictions, travel stocks could be looking at brighter days ahead. Safe to say, after being cooped up in our homes for the past two years or so, there is likely a significant pent-up demand to travel again. In fact, despite the high inflation, travel demand remains strong, with consumers spending $8.8 billion on domestic U.S. airline tickets last month. For comparison, this is up by 28% compared with March 2019, before the pandemic struck. As such, I wouldn’t be surprised if investors are feeling bullish on travel stocks.
Take Delta Airlines (NYSE: DAL) for example. Although the company made a loss the past quarter, the company forecasts a return to profit this current quarter. The company said its operations in March were profitable and that it had been able to pass some of the higher cost of fuel along to customers. Elsewhere, we have United Airlines (NASDAQ: UAL). United on Tuesday boosted its outlook for its first-quarter financials thanks to a rebound in travel. Namely, it expects total operating revenue to be near the better end of its previous guidance of down between 20% and 25%. With travel companies starting to return to profit, be sure to watch these four travel stocks in the stock market today.
Travel Stocks To Buy [Or Sell] Right Now
Kicking off our list today is American Airlines, or AAL for short. In short, the company is a leading name in the global air travel industry today. On average, the company operates nearly 6,700 daily flights to almost 350 destinations across 50 countries. On top of that, AAL is a founding member of the Oneworld alliance, whose members serve more than 1,000 destinations with flights to over 150 countries. In the past month, AAL stock has risen over 30%.
Just this month, the company announced a partnership renewal with Expedia Group (NASDAQ: EXPE). Travelers who book AAL flights through Expedia Group’s platforms will now be able to customize their travel and choose elevated offers such as Main Plus. The fare products are now available thanks to a direct connection through New Distribution Capability (NDC) technology. Essentially, this makes all of AAL’s offers available to travelers on Expedia Group sites. This integration of NDC effectively scales up the collaboration between AAL and Expedia, which is the airline’s largest third-party agency. Given this collaborative effort, should you invest in AAL stock?
Norwegian Cruise Line
Another travel stock to consider is Norwegian Cruise Line, or Norwegian for short. Being the third-largest cruise line in the world, the company boasts a combined fleet of 28 ships with nearly 60,000 berths. It operates cruise brands such as Norwegian Cruise Line, Oceania Cruises, and Regent Seven Seas Cruises brands. Furthermore, these brands offer itineraries to more than 490 destinations worldwide. The company also has nine more ships scheduled for delivery through 2027, comprising approximately 24,000 berths. In the past month, NCLH stock has risen by over 25%.
Following last week’s news, it seems that Norwegian is the latest company to hop on the NFT trend. Namely, the company launched its NCL NFT marketplace, along with the launch of its first NFT collection. The collection comprises six NFTs designed by Italian artist Manuel Di Rita, widely known as “Peeta”. Peeta designed the hull art on the Norwegian Prima and sister vessel Norwegian Viva. As a matter of fact, this launch is the first for both Norwegian and the cruise industry and adds to the company’s legacy of pioneering firsts. With this in mind, would you consider adding NCLH stock to your watchlist?
Following that, we have Spirit Airlines, a company that positions itself as an ultra-low fare airline. In fact, the company is a leader in providing customizable travel options that start with an unbundled fare. Also, its Fit Fleet is one of the most fuel-efficient in the U.S. The company also serves destinations throughout the U.S., Latin America, and the Caribbean. In the past month, SAVE stock has risen by nearly 30%. In February, rival discount airline Frontier Airlines (NASDAQ: ULCC ) agreed with Spirit to merge into a discount airline behemoth.
However, it seems that JetBlue (NASDAQ: JBLU) is looking to challenge this merger. Just this month, JetBlue made a $3.6 billion all-cash offer to acquire Spirit. As such, this raises questions about Spirit’s current deal with Frontier. JetBlue CEO Robin Hayes has ramped up his pressure on Frontier, saying that his company’s surprise deal for low-fare rival Spirit Airlines makes much more sense. Frontier, on the other hand, has not upped its bid and there has not been any indication that it will. As the news develops, will you be keeping tabs on SAVE stock?
Finally, we have Marriott International. It is a multinational company that operates, franchises, and licenses lodging to customers all over the world. Its portfolio includes nearly 8,000 properties under 30 leading brands across 139 countries and territories. The company offers Marriott Bonvoy, its highly-awarded travel program. With the recent reopening of Vietnam’s borders, Marriott recently announced plans to expand its portfolio in Vietnam. Notably, it expects to add an impressive 9,000 rooms to the company’s portfolio of highly-reputed hotels.
This includes hotel brands such as Ritz-Carlton Residences, Marriott Hotels, Westin, and Courtyard by Marriott. On top of that, its most global brand, Sheraton Hotels & Resorts, will also be making its debut across popular tourist destinations in Vietnam such as Ha Long Bay. Vietnam, being a top go-to destination for tourists, has experienced record levels of tourism over the past few years, giving a reason for Marriott to expand its presence in the Vietnamese market. As it stands, the company operates ten properties in Vietnam, comprising 3,294 rooms and spanning six of the company’s brands. All in all, would you buy MAR stock?
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.