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7 Travel Stocks You Should Invest In Once The Coronavirus Pandemic Is Over
Several industries have taken a hard hit financially since the COVID-19 pandemic. Companies in the travel industry have been severely impacted due to stay-at-home orders, travel restrictions, and lockdowns.
However, there is some hope. There are travel stocks that will recover and will be worth investing in after the pandemic is over.
These are the 7 travel stocks you should invest in, according to InvestorPlace:
Royal Caribbean – (RCL)
The CEO of Royal Caribbean, Richard Fain, has been in the industry for years and is extremely experienced. With his vast knowledge of the industry, it is predicted that Royal Caribbean will recover from this financial hit very quickly.
According to InvestorPlace, if you invest when the pandemic ends, “come 2029, I expect today’s risk-takers to be rewarded generously. If you’re thinking of retiring in 10 years, I’d consider Royal Caribbean’s stock, but only if you’re in it for the long haul.”
Southwest Airlines – (LUV)
Southwest Airlines has been working very hard to keep their company above water. On March 31st, the airline company announced it will be offering cargo-only flights, for the first time in its 48 years of being in operation.
InvestorPlace predicts that Southwest Airlines will recover quickly after travel is allowed again and investing in LUV is great for long-term investments.
LVMH – (LVMH)
You may know LVMH because of luxury brands such as Louis Vuitton, Fenty, Moet & Chandon, Hennessy, and Sephora. However, there are travel-related brands under the LVMH brand that have been impacted by the pandemic.
DFS, Starboard Cruise Services, and the Belmond travel brand which includes luxury hotels, trains, river cruises, and safaris are all under financial stress.
However, LVMH continues to have very strong revenue growth and is worth the investment, especially five years from now.
Estee Lauder (EL)
The company known for beauty has also established itself as a travel retailer, according to InvestorPlace.
Estee Lauder reveals that over one billion travelers pass through airports annually and that’s where they have been getting a bulk of its sales in the past years.
The beauty retailer may be getting hit now since people aren’t flying, but since most of it’s market is in Asia, things will be looking up soon.
Hilton Hotels – (HLT)
According to the American Hotel & Lodging Association, about $500 million in room revenue is being lost per day in the U.S. hotel industry.
“Based on taking a look at the balance sheets, the leverage of some of the major brands at this point, I think Hilton is the most well-capitalized to make it through and weather the storm,” says Deborah Friedland, Hospitality Practice Lead at EisnerAmper to Yahoo! Finance on April 8th.
Hilton’s CEO Christopher Nassetta has given up receiving his salary for the remainder of 2020 and executive committee members will be taking a 50% pay cut for the remainder of the pandemic.
InvestorPlace predicts that Hilton Hotels will be trading above $100 within the next 18-24 months, so it’s wise to invest as soon as the pandemic is over.
MGM Resorts International (MGM)
Over the past two quarters, MGM has reduced its debt by $3.9 billion due to the selling of the real estate where the Bellagio, MGM Grand and Mandalay Bay operate.
MGM Resorts International has the finances to weather the storm of the pandemic and recover once it is over.
Booking Holdings (BKNG)
Before the pandemic hit, Booking Holdings was in a great space financially. InvestorPlace reports that the company had $7.3 billion in cash and marketable securities at the end of 2019.
Since Booking Holdings has the accounts for Kayak and OpenTable, it is taking a hit right now due to the lack of bookings.
However, once businesses are back up and running, Booking Holdings will be booming again.