Is the summer vacation boom over before it even began?
This summer has long been forecast as a potential boom time for the travel industry. Retailers and economists have been talking a lot about how consumers are starting to buy less stuff and are instead spending more on vacations and other experiences. But that's not the story the travel stocks themselves are telling. Worries about inflation and a resurgence in Covid cases in China are starting to take their toll. After a hot start to the year, shares of major hotel chains including Hilton, Wyndham and Hyatt have tumbled on economic jitters and travel slowdown concerns. All three stocks are down nearly 20% this year. Casino stocks also have plunged, as have shares of cruise operators. Major airline stocks, which have held up better than the broader market this year, have been losing altitude lately. Shares of American, United, Delta (DAL) and Southwest (LUV) all fell sharply Tuesday and are now in the red for 2022.<br/>And now Airbnb is trading near an all-time low, more than 50% below its IPO price from late 2020. Vrbo owner Expedia (EXPE) has lost more than a third of its value in 2022.<br/>Is this a bad sign for the summer travel season and the economy? It's still too hard to tell. It's worth remembering that last year's second and third quarter earnings and revenue for leisure companies was incredibly strong as consumers started to worry less about Covid. Many Americans tired of sheltering in place in 2020 went back out and traveled as Covid cases dropped during what was dubbed the "Hot Vax Summer." So companies in the travel business may be facing difficult comparisons to last year's results. Add inflation pressures into the mix, and the year-to-year contrast could be even more jarring. Story has more.<br/>
https://portal.staralliance.com/cms/news/hot-topics/2022-05-26/general/is-the-summer-vacation-boom-over-before-it-even-began
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Is the summer vacation boom over before it even began?
This summer has long been forecast as a potential boom time for the travel industry. Retailers and economists have been talking a lot about how consumers are starting to buy less stuff and are instead spending more on vacations and other experiences. But that's not the story the travel stocks themselves are telling. Worries about inflation and a resurgence in Covid cases in China are starting to take their toll. After a hot start to the year, shares of major hotel chains including Hilton, Wyndham and Hyatt have tumbled on economic jitters and travel slowdown concerns. All three stocks are down nearly 20% this year. Casino stocks also have plunged, as have shares of cruise operators. Major airline stocks, which have held up better than the broader market this year, have been losing altitude lately. Shares of American, United, Delta (DAL) and Southwest (LUV) all fell sharply Tuesday and are now in the red for 2022.<br/>And now Airbnb is trading near an all-time low, more than 50% below its IPO price from late 2020. Vrbo owner Expedia (EXPE) has lost more than a third of its value in 2022.<br/>Is this a bad sign for the summer travel season and the economy? It's still too hard to tell. It's worth remembering that last year's second and third quarter earnings and revenue for leisure companies was incredibly strong as consumers started to worry less about Covid. Many Americans tired of sheltering in place in 2020 went back out and traveled as Covid cases dropped during what was dubbed the "Hot Vax Summer." So companies in the travel business may be facing difficult comparisons to last year's results. Add inflation pressures into the mix, and the year-to-year contrast could be even more jarring. Story has more.<br/>
