Promising Travel Stocks to Consider Amid Strong Interest in Travel

Despite tightening budgets in certain discretionary spending areas, such as dining out and luxury goods, interest in travel remains strong among consumers. This has resulted in a surprising stability in travel stocks, as individuals continue to allocate funds for vacations and trips. With 93% of travelers having travel plans within the next six months and the total number of combined trips expected to reach pre-pandemic levels by late 2024, the travel industry presents ample opportunities for investors to grow their wealth.

Three travel stocks stand out as promising options for investment, leveraging technology to reduce overhead and create additional revenue streams. Viking Holdings, the parent company of Viking River Cruises, recently had a successful initial public offering (IPO) and has seen an 8% increase in stock value since then. The company, which has been in business since 1997, is well-positioned to benefit from the growing popularity of river cruises, particularly among younger travelers who appreciate the convenience and cost-effectiveness of exploring multiple cities while unpacking only once. Viking Holdings plans to expand its fleet and venture into land tours and safaris, further capitalizing on the luxury vacation market.

Booking Holdings, the world’s largest do-it-yourself travel agency, operates through a vast network of subsidiary brands such as Priceline, Booking.com, Agoda, KAYAK, and OpenTable. The company’s first-quarter results for 2024 exceeded expectations, with a 9% year-over-year growth in room night bookings and a 17% increase in revenue. Booking Holdings’ ability to continue rapid growth, even in a stagnant economy, is evident. The company is also leveraging artificial intelligence (AI) software to enhance consumer-facing tools, aiming to reduce live agent contact rates and increase bookings. This strategic approach to reducing customer service costs and generating additional reservations positions Booking Holdings for future success.

The US Global Jets ETF (JETS) offers investors an opportunity to capitalize on the potential rebound of the airline industry. Composed of companies representing U.S. and international passenger airlines, aircraft manufacturers, airports, terminal services companies, and airline-related internet media and services companies, JETS provides exposure to a diversified portfolio. While the airline industry has faced challenges due to increased fuel costs, labor shortages, contract disputes, and negative press surrounding aircraft quality, analysts expect a 23% upside for JETS with an average price target of $24.28. Investing in JETS now, while the sector is still experiencing difficulties, could lead to significant gains when the industry rebounds.