A lot has changed since COVID-19 first shrouded the world, especially travel.  

The dark days when many of us were forced to stay in our homes, ordering our groceries and stocking up on Amazon’s eight-pack of Clorox All-Purpose Bleach Cleaner, are those we hope to leave further and further behind.  

Two years on, the world is on the road to recovery, and many things that were impossible to do in 2020 have resumed – going to movie theaters and restaurants, live music, weddings and reunions, even international travel.  

The travel recovery is in full bloom, as this photo from London’s Heathrow airport clearly illustrates. I snapped this pic yesterday, after wading through swarms of fellow tourists for nearly three hours to pass through check-in and security.” 

Although I spent only a few days “across the pond,” I encountered large crowds in every airport, train station and hotel lobby. 

The resurgence of travel is something I’ve spoken about at length since May 2021.  

And while the timing was off originally, thanks to the new COVID variants that came about late last year, I believe that the recovery period for travel is coming – and it’s bringing a font of opportunities with it… 

Summertime, And the Living’s Easy 

The travel recovery is in full swing. Period. 

Summertime is historically the most popular time to travel, and we’re seeing that popularity rise again as restrictions wane, and we seem to be moving in the right direction with COVID-19. 

Let’s take a look at some quick numbers from the U.S. Travel Association’s Key June Highlights… 

• Travel spending hit a new pandemic high of $101 billion in May, just slightly above April’s $100 billion… 
• Similar to April, as of June, 89% of companies now allow non-essential domestic business travel…  
• And in-person meetings are the top business travel expense companies are planning on for the remainder of the year – spending for conferences as a share of overall business travel spend is expected to be up four percentage points from 2019. 

That’s all GREAT news for travel.  

To further compound this positivity, the International Air Transport Association (IATA) published a press release in mid-June that states (for the airline industry)… 

• Industry-wide profitability in 2023 appears within reach with North America already expected to deliver an $8.8 billion profit in 2022… 
• Strong pent-up demand, the lifting of travel restrictions in most markets, low unemployment in most countries, and expanded personal savings are fueling a resurgence in demand that will see passenger numbers reach 83% of pre-pandemic levels in 2022… 
• And despite economic challenges, cargo volumes are expected to set a record high of 68.4 million tonnes in 2022. 

And as the chart below shows, travel activity continues to recover from its two-year COVID swoon. 

The 30-day average tally of TSA daily travelers has climbed to just 10% below pre-COVID levels – and the numbers continue to surge. During the Fourth of July weekend, U.S. air travel topped pre-pandemic levels! 

As evidenced by the above numbers, many folks are taking “revenge” on the two-year COVID pandemic by booking long-delayed travel and vacation plans.  

Certainly, the travel recovery trend faces ongoing headwinds, and setbacks are possible – the whole year for 2022 has been a massive setback for the markets.  

But as I’ve said before, megatrends will weather hiccups, but they go on to make stronger, better recoveries than other stocks.  

And while stocks are trading on the cheap, scooping up shares of your favorite travel stocks isn’t a bad idea.  

We already did so earlier this year in Investment Report, targeting one hospitality company and a timeshare company, both of which have huge potential in their subsectors.  

They’ve both weathered small losses this year, but I see them roaring back to life… along with the rest of the travel industry. 

Regards,  

Eric 

P.S. Those two travel-related picks I mentioned are still in our open portfolio, so I can’t disclose their names. However, if you’d like to learn how to gain access to them – along with the rest of my suite of recommendations, click here. 

On the date of publication, Eric Fry did not have (either directly or indirectly) any positions in the securities mentioned in this article.