Social distancing mandates, the widespread availability of COVID-19 treatments, and steady progress on the vaccination front have led to a decline in COVID-19 cases worldwide. Furthermore…
the U.S. Centers for Disease Control and Prevention expects COVID-19 deaths and hospitalizations to fall. As a result, most countries are lifting their international travel restrictions, making the backdrop favorable for the travel and tourism industry.
Companies in this space are witnessing an uptick in demand ahead of the forthcoming holiday season, and the travel and tourism market is expected to grow at a 24.5% CAGR to $924.27 billion by 2025.
Given this backdrop, we think travel and tourism stocks InterContinental Hotels Group PLC (IHG – Get Rating), China Eastern Airlines Corporation Limited (CEA – Get Rating), SkyWest, Inc. (SKYW – Get Rating), and Bluegreen Vacations Holding Corporation (BVH – Get Rating) could deliver solid upside in the near term. So, it could be wise to bet on these stocks now.
InterContinental Hotels Group PLC (IHG – Get Rating)
Based in the U.K., IHG owns, manages, franchises, and leases hotels, resorts, restaurants, and spas under an established and diverse group of brands worldwide. The company manages hotel loyalty and priority club rewards programs. As of December 31, 2020, the IHG had approximately 5,964 hotels and 886,036 rooms in approximately 100 countries.
On October 13, IHG signed a management agreement with notable real estate developer Dinesh Kumar Choudhary (HUF) for a new hotel–the Holiday Inn Express & Suites Jaipur Karoli Bagh, located in Jaipur, India. As one of India’s most popular leisure destinations, which is home to numerous industries, the company expects to witness great hotel bookings from domestic and international travelers. The hotel is expected to be operational by the first quarter of 2023.
On October 11, IHG announced the establishment of its footprint in Italy, with the opening of three new hotels and the signing of two more. The company is looking forward to capitalizing on the increase in demand for its premium and lifestyle brands, such as voco and Hotel Indigo,
For the half-year, ended June 30, 2021, IHG’s operating profit came in at $138 million, compared to a $233 million loss in the prior-year period. While its adjusted earnings increased 722.2% year-over-year to $74 million, its adjusted earnings increased 724.5% year-over-year to $0.40. IHG had $988 million in cash and cash equivalents as of June 30, 2021.
IHG’s EPS is estimated to rise 280.3% year-over-year to $1.19 in the current year. Analysts expect its revenue to be $1.39 billion for the current year, representing a 40.3% rise year-over-year. Over the past three months, the stock has gained 9.4% in price and ended yesterday’s trading session at $70.48.
IHG’s POWR Ratings reflect this promising outlook. The stock has an overall B rating, which equates to Buy in our proprietary rating system. The POWR Ratings are calculated by considering 118 different factors, with each factor weighted to an optimal degree.
The stock has a B grade for Growth, Quality, Momentum, and Sentiment. Click here to see the additional ratings for IHG’s Value and Stability.
Of the 20 stocks in the Travel – Hotels/Resorts industry, IHG is ranked #4.
China Eastern Airlines Corporation Limited (CEA – Get Rating)
CEA is a China-based company that is engaged principally in the provision of airline transportation and extended services internationally. It offers flight training, airline maintenance, import and export, investment, leasing, consultation services, hotel services, the research and development of technology and products in aviation. It also offers an…
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