While it’s an adventurous idea in more ways than one, if you believe in the lasting power of revenge travel, these ideas for best travel stocks to buy in April could be enticing.
According to research from Deloitte, the immediacy of the revenge travel sentiment has likely waned. After all, it’s been a while since governments across the world opened their borders following the Covid-19 disaster. Going abroad is no longer a must-have novelty experience. Nevertheless, consumers may prioritize vacationing in a way that they’ve never done before.
To be sure, investors should be cognizant of risk factors. Currently, there appears to be a rotation away from risk-on names. As well, the sector at hand depends heavily on the health of the economy. Still, if you believe in the aforementioned trend, these are the best travel stocks to buy in April.
Uber (UBER)
While not the purest enterprise in the industry, ride-sharing pioneer Uber (NYSE:UBER) nevertheless ranks as one of the best travel stocks to buy in April. Fundamentally, that’s because Uber helps “decentralize” mobility abroad. Prior to ride-sharing platforms, people had to know some linguistic basics to get around. Now, all you have to do is push some buttons on your phone.
From personal experience, I’ve used Uber in countries thousands of miles away from my home. It’s really a beautiful innovation. Plus, in this sense, I appreciate Uber more than its rival Lyft (NASDAQ:LYFT). The former simply features far more coverage than the latter. Plus, aside from a hiccup in the third quarter, the company has impressed in terms of quarterly earnings performances.
For fiscal 2024, experts are projecting earnings per share of $1.34. That’s well above last year’s EPS of 87 cents. Also, they’re looking for revenue of $43.3 billion, up 16.1% from 2023’s tally of $37.28 billion.
Overall, analysts rate shares a consensus strong buy with an $87.19 price target, implying over 16% upside potential.
Choice Hotels (CHH)
A hotel franchisor, Choice Hotels (NYSE:CHH) operates in the U.S. and internationally. It conducts business through two segments: Hotel Franchising & Management and Corporate & Other. In particular, CHH makes an intriguing idea for best travel stocks to buy in April because of its ownership of discount brands. Yes, people may want to enjoy their rest and relaxation. However, they probably want to do so cheaply.
For full disclosure, CHH stock is a choppy asset. Over the past one-year period, it gained under 3%. And no, we’re not talking about a security that merely inched its way forward every month. That said, the underlying company is surprisingly stout. Aside from an EPS miss in Q3, the company beat all other quarterly targets last year. Overall, the average positive earnings surprise came out to 5.1%.
For the current fiscal year, analysts anticipate EPS to reach $6.38. That’s a decent improvement over last year’s result of $6.11. Further, they see revenue moving to $1.6 billion, an increase of 3.7% over last year’s tally of $1.54 billion. Thanks to its relevance, CHH could be one of the best travel stocks to buy in April.
Southwest Airlines (LUV)
Dialing up the risk-reward factor for the best travel stocks to buy in April, we have discount airliner Southwest Airlines (NYSE:LUV). Fundamentally and without recent context, the narrative makes perfect sense. People who prioritize new experiences will probably want to focus on that – the experiences, not the flights themselves. So, buying discount airfare seems a reasonable idea.
However, Southwest is heavily dependent on Boeing (NYSE:BA). And because Boeing has its own set of serious troubles, the matter has forced the airliner to reevaluate its 2024 guidance. Management stated that it will provide an updated forecast on April 25. Based on the more than 11% loss in value over the past 52 weeks, the market is skeptical.
Nevertheless, it’s also possible that the company could reveal better-than-expected news. If that happens, LUV stock could fly higher. Also, the basic narrative remains viable. If people do prioritize traveling, they will want cheap airfare.
If anything, LUV trades at only 0.69X trailing-year revenue. It might be worth looking at if you don’t mind contrarian speculation.
On the date of publication, Josh Enomoto did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
