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4 Solid Hotel Stocks to Buy Ahead of Labor Day Vacation
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Labor Day is around the corner and Americans are planning to go on vacation during the holiday weekend. Higher air ticket prices are a worrying factor this time around but that hasn’t stopped people from making their plans.
In fact, several hotels across the United States are slashing room rents, given the higher prices travelers have to pay for air tickets. Moreover, Americans are desperate to go on a holiday after canceling trips over the last two years owing to the pandemic. Given this scenario, stocks like Marriott Vacations Worldwide Corporation (VAC - Free Report) , Choice Hotels International, Inc. (CHH - Free Report) , InterContinental Hotels Group PLC (IHG - Free Report) and Marriott International, Inc. (MAR - Free Report) are likely to benefit in the near term.
U.S. Gears Up for Holiday
According to The Vacationer’s Labor Day 2022 Travel Survey, around 137 million or 53% of Americans will be traveling during the Labor Day weekend, with driving being the most preferred mode of transport.
Of the total, around 35.5% or 92 million will travel by car, while 14.2% or 37 million plan to travel by air. Understandably, traveling by car would be the preferred choice as flight fares are rising almost by the day. Even then, the volume of flyers on Labor Day is going to be a lot higher than on the Fourth of July or Memorial Day weekends.
This suggests that people are willing to spend on the upcoming holiday weekend despite soaring prices. Fuel costs have declined lately from the peak inflation costs, which may have worked as a key factor in many deciding to travel by car.
However, 50.2% of the respondents who would go on vacation said that higher fuel costs will still hamper their travel plans.
That said, despite higher prices, Americans are desperate to go on a holiday. The last two years saw people almost putting a halt to their vacation plans. The first year of the pandemic saw hotels almost closed, while air travel was restricted. Things started changing from the end of last year as the government started lifting restrictions following the massive vaccination drive.
Even then, people were skeptical about planning vacations as the Delta and Omicron variants played spoilsport. This year is a lot different and life seems to be coming back to normal but soaring inflation has been a major factor that has compelled people to spend cautiously.
Hotel and Leisure Sector Trying to Bounce Back
The travel and leisure sector, along with the hotel industry, was one of the major casualties of the pandemic. Things started looking up from the end of last year but the airline industry is once again faced with challenges as higher fuel costs have been responsible for ticket prices skyrocketing over the past few months.
To help out people and the industry, several hotels are slashing room rents so that the holiday budget for people gets balanced. According to the travel booking app Hopper, hotel rooms in the United States will cost $189 per night on average this Labor Day weekend, up 6% from last year but slightly down from $193 per night, which was the average in June.
Moreover, the travel and leisure sector hasn’t yet succumbed to inflationary pressures as people are planning vacations. This has also seen hiring gather pace in the sector over the past few months.
The United States added 528,000 new jobs in July, higher than the consensus estimate of 250,000. The leisure and hospitality sector, which also includes restaurants and bars, recorded the highest job gains. The sector added 96,000 jobs given the surge in travel, and still has a large number of vacancies.
Marriott Vacations Worldwide Corporation offers vacation ownership, exchange, rental, resort and property management services. As of 2021-end, VAC had more than 120 resorts and 700,000 owners and members in a diverse portfolio of seven vacation ownership brands. Marriott Vacations Worldwide Corporation also has exchange networks and membership programs in more than 3,200 resorts in 90 countries.
Marriott Vacations Worldwide Corporation’s expected the earnings growth rate for the current year is more than 100%. The Zacks Consensus Estimate for current-year earnings has improved 1.1% over the past 60 days. VAC sports a Zacks Rank #1.
Choice Hotels International, Inc. is one of the largest hotel franchisors globally. As of Mar 31, 2022, CHH had 6,996 hotels open, representing nearly 577,714 rooms. Choice Hotels International is spread across 40 countries and territories internationally and is present in 50 states domestically and the District of Columbia.
Choice Hotels International’s expected earnings growth rate for the current year is 19.6%. The Zacks Consensus Estimate for current-year earnings has improved 5.1% over the past 60 days. CHH has a Zacks Rank #2.
InterContinental Hotels Group PLC offers information and reservations capability on the Internet for InterContinental Hotels & Resorts, Crowne Plaza Hotels & Resorts, Holiday Inn hotels, Holiday Inn Express hotels, and Staybridge Suites by Holiday Inn hotels. IHG owns, manages, franchises, and leases hotels across all continents.
InterContinental Hotels Group’s expected earnings growth rate for the current year is 81.6%. The Zacks Consensus Estimate for current-year earnings has improved 5.1% over the past 60 days. IHG has a Zacks Rank #2.
Marriott International, Inc. is a leading worldwide hospitality company focused on lodging management and franchising, after the spin-off of its timeshare business into a publicly-traded company in November 2011. As of Aug 2, 2022, MAR operated, franchised and acted as a licensor of hotels as well as timeshare properties to more than 8,100 properties across 139 countries and territories under 30 brand names.
Marriott International’s expected earnings growth rate for the current year is more than 100%. The Zacks Consensus Estimate for current-year earnings has improved 7.4% over the past 60 days. MAR has a Zacks Rank #2.
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4 Solid Hotel Stocks to Buy Ahead of Labor Day Vacation
Labor Day is around the corner and Americans are planning to go on vacation during the holiday weekend. Higher air ticket prices are a worrying factor this time around but that hasn’t stopped people from making their plans.
In fact, several hotels across the United States are slashing room rents, given the higher prices travelers have to pay for air tickets. Moreover, Americans are desperate to go on a holiday after canceling trips over the last two years owing to the pandemic. Given this scenario, stocks like Marriott Vacations Worldwide Corporation (VAC - Free Report) , Choice Hotels International, Inc. (CHH - Free Report) , InterContinental Hotels Group PLC (IHG - Free Report) and Marriott International, Inc. (MAR - Free Report) are likely to benefit in the near term.
U.S. Gears Up for Holiday
According to The Vacationer’s Labor Day 2022 Travel Survey, around 137 million or 53% of Americans will be traveling during the Labor Day weekend, with driving being the most preferred mode of transport.
Of the total, around 35.5% or 92 million will travel by car, while 14.2% or 37 million plan to travel by air. Understandably, traveling by car would be the preferred choice as flight fares are rising almost by the day. Even then, the volume of flyers on Labor Day is going to be a lot higher than on the Fourth of July or Memorial Day weekends.
This suggests that people are willing to spend on the upcoming holiday weekend despite soaring prices. Fuel costs have declined lately from the peak inflation costs, which may have worked as a key factor in many deciding to travel by car.
However, 50.2% of the respondents who would go on vacation said that higher fuel costs will still hamper their travel plans.
That said, despite higher prices, Americans are desperate to go on a holiday. The last two years saw people almost putting a halt to their vacation plans. The first year of the pandemic saw hotels almost closed, while air travel was restricted. Things started changing from the end of last year as the government started lifting restrictions following the massive vaccination drive.
Even then, people were skeptical about planning vacations as the Delta and Omicron variants played spoilsport. This year is a lot different and life seems to be coming back to normal but soaring inflation has been a major factor that has compelled people to spend cautiously.
Hotel and Leisure Sector Trying to Bounce Back
The travel and leisure sector, along with the hotel industry, was one of the major casualties of the pandemic. Things started looking up from the end of last year but the airline industry is once again faced with challenges as higher fuel costs have been responsible for ticket prices skyrocketing over the past few months.
To help out people and the industry, several hotels are slashing room rents so that the holiday budget for people gets balanced. According to the travel booking app Hopper, hotel rooms in the United States will cost $189 per night on average this Labor Day weekend, up 6% from last year but slightly down from $193 per night, which was the average in June.
Moreover, the travel and leisure sector hasn’t yet succumbed to inflationary pressures as people are planning vacations. This has also seen hiring gather pace in the sector over the past few months.
The United States added 528,000 new jobs in July, higher than the consensus estimate of 250,000. The leisure and hospitality sector, which also includes restaurants and bars, recorded the highest job gains. The sector added 96,000 jobs given the surge in travel, and still has a large number of vacancies.
Our Choices
It would be wise to invest in four hotel stocks that are poised well to gain. Each of the stocks carries a Zacks Rank #1 (Strong Buy) or #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Marriott Vacations Worldwide Corporation offers vacation ownership, exchange, rental, resort and property management services. As of 2021-end, VAC had more than 120 resorts and 700,000 owners and members in a diverse portfolio of seven vacation ownership brands. Marriott Vacations Worldwide Corporation also has exchange networks and membership programs in more than 3,200 resorts in 90 countries.
Marriott Vacations Worldwide Corporation’s expected the earnings growth rate for the current year is more than 100%. The Zacks Consensus Estimate for current-year earnings has improved 1.1% over the past 60 days. VAC sports a Zacks Rank #1.
Choice Hotels International, Inc. is one of the largest hotel franchisors globally. As of Mar 31, 2022, CHH had 6,996 hotels open, representing nearly 577,714 rooms. Choice Hotels International is spread across 40 countries and territories internationally and is present in 50 states domestically and the District of Columbia.
Choice Hotels International’s expected earnings growth rate for the current year is 19.6%. The Zacks Consensus Estimate for current-year earnings has improved 5.1% over the past 60 days. CHH has a Zacks Rank #2.
InterContinental Hotels Group PLC offers information and reservations capability on the Internet for InterContinental Hotels & Resorts, Crowne Plaza Hotels & Resorts, Holiday Inn hotels, Holiday Inn Express hotels, and Staybridge Suites by Holiday Inn hotels. IHG owns, manages, franchises, and leases hotels across all continents.
InterContinental Hotels Group’s expected earnings growth rate for the current year is 81.6%. The Zacks Consensus Estimate for current-year earnings has improved 5.1% over the past 60 days. IHG has a Zacks Rank #2.
Marriott International, Inc. is a leading worldwide hospitality company focused on lodging management and franchising, after the spin-off of its timeshare business into a publicly-traded company in November 2011. As of Aug 2, 2022, MAR operated, franchised and acted as a licensor of hotels as well as timeshare properties to more than 8,100 properties across 139 countries and territories under 30 brand names.
Marriott International’s expected earnings growth rate for the current year is more than 100%. The Zacks Consensus Estimate for current-year earnings has improved 7.4% over the past 60 days. MAR has a Zacks Rank #2.