Loding Loading ...
Trading in financial markets involves significant risk of loss which can exceed deposits and may not be suitable for all investors.
Before trading, please ensure that you fully understand the risks involved
Trading in financial markets involves significant risk of loss which can exceed deposits and may not be suitable for all investors. Before trading, please ensure that you fully understand the risks involved

Thursday, September 22, 2022

4 companies to explore while navigating the stock market this World Tourism Day

By Century Financial in Blog

4 companies to explore while navigating the...
4 companies to explore while navigating the stock market this World Tourism Day

World Tourism Day is celebrated each year on September 27 to spread awareness of the importance of tourism and its significant value, be it social, cultural, political, or economic.

COVID-19 had severely impacted the tourism industry. However, the world has come a long way since then.

Vaccination drives and easing travel guidelines have helped the sector recuperate significantly from the damage done by COVID-19.

In fact, International tourism witnessed a strong rebound in the first five months of 2022, with nearly 250 million international arrivals recorded, according to the latest UNWTO World Tourism Barometer.

Arrivals from January to May 2021 were 77 million, implying that the sector has recovered by nearly half (46%) of pre-pandemic 2019 levels.

This World Tourism Day, we highlight four popular stocks - with exposure across travel, leisure, and tourism industries - worth adding to your watchlist.

However, it must always be noted that stock market investment carries risk and may result in a loss of capital.

Airbnb (ABNB) is well poised to capitalize on the rising popularity of alternative accommodations, especially after the COVID recovery in travel. Over 4 million Hosts are sharing their worlds on Airbnb.

In the second quarter of 2022, the company witnessed solid Nights and Experiences Bookings, showing strong growth over pre-pandemic levels, led by robust performance across North America, EMEA and Latin America.

Strength in bookings resulted in 58% YoY growth in Q2 revenues, which came in at $2.1 billion, exceeding Q2 2019 revenues by 73%.

Airbnb's ability to adjust to travellers' needs quickly and the introduction of thoughtful features, including AirCover for Hosts and AirCover for Guests, remains key catalyst in boosting rebookings.

Further, the prospects are enormous, as the alternative accommodation market has a mammoth total addressable market (TAM) of $810 billion.

However, recessionary fears might weigh on bookings as individuals could consider cutting travel expenditures.

Booking Holdings Inc. (BKNG) witnessed growth in bookings in the second quarter of 2022 and the momentum is expected to have continued in the third quarter driven by rising travel demand.

In Q2, Booking Holdings' total revenues were $4.3 billion, up 99% YoY. Revenue growth was driven by a robust accommodation average daily rate (ADR) growth, which helped drive a 57% YoY increase in gross bookings. Moreover, Room nights booked in Q2 increased by 56% YoY.

The company is expected to benefit from solid ongoing momentum across its agency and merchant businesses. Further, expanding international presence could augur well.

However, macroeconomic challenges and stiff competition in the online travel industry remain vital concerns.

Marriott International, Inc. (MAR) is expected to benefit from a solid recovery in travel worldwide. The onset of summer & business travel and pent-up travel demand is anticipated to have benefitted Marriott's third-quarter performance.

In the second quarter of 2022, Marriott delivered adjusted diluted earnings of $1.80 per share, up 128% YoY. The earnings growth was driven by 70% YoY growth in revenues which came in at $5.34 billion.

In Q2, worldwide revenue per available room (RevPAR) increased 70.6% YoY, with 87.8% growth in international markets leading the way, followed by a 66.1% increase in the US & Canada.

At the end of Q2, Marriott's global lodging system totalled more than 8,100 properties, with over 1,500,000 rooms. Further, the company ended the quarter with a worldwide development pipeline totalling 2,942 properties.

Given its property locations and solid pipeline, the company is well positioned to benefit from the increasing market demand on the back of ramped-up business and leisure travelling demand.

However, existing macroeconomic challenges could be a headwind.

Hilton Worldwide Holdings Inc. (HLT) boasts nearly 7,000 properties & approximately 1,100,000 rooms across 122 countries and territories, making it one of the world's largest and most diversified hotel companies.

The company's resilient asset-light, fee-based business model and stringent cost-control measures hold promise.

In the second quarter of 2022, system-wide comparable RevPAR increased 54.3% YoY, driven by an increase in occupancy and ADR and 54% YoY growth in fee revenues.

However, comparing the company's performance as per pre-pandemic results, system-wide comparable RevPAR for the three months ended June 30, 2022, was down 2.1% over the three months ended June 30, 2019. This decline in RevPAR compared to pre-pandemic levels remains a significant concern for the company.

Company Airbnb,
Inc.
Booking
Holdings Inc.
Marriott
International, Inc.
Hilton Worldwide
Holdings Inc.
Ticker ABNB BKNG MAR HLT
52-week Low $86.71 $1,669.34 $131.01 $108.41
Share Price* $114.01 $1,806.70 $148.17 $124.63
52-week High $212.58 $2,715.66 $195.90 $167.99
Market Capitalization
(in Billions)
$72.91 $71.74 $48.09 $34.18
Year-to-Date
Return
-34% -26.6% -9.6% -19.3%

*As of US markets close on September 21 2022

You may take help from our investment consultant to explore several other companies based on your risk profile.

Disclaimer: Century Financial Consultancy LLC (“CFC”) is Limited Liability Company incorporated under the Laws of UAE and is duly licensed and regulated by the Emirates Securities and Commodities Authority of UAE (SCA). This document is a marketing material and is for informational purposes only and must not be construed to be an advice to invest or otherwise in any investment or financial product. CFC does not guarantee as to adequacy, accuracy, completeness or reliability of any information or data contained herein and under no circumstances whatsoever none of such information or data be construed as an advice or trading strategy or recommendation to deal (Buy/Sell) in any investment or financial product. CFC is not responsible or liable for any result, gain or loss, based on this information, in whole or in part. Please carefully read full disclosure mentioned on the website.