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ETFs to Play the Uptick in International Travel

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The latest earnings reports from the big three online travel companies – Airbnb Inc. (ABNB - Free Report) , Expedia Group Inc. (EXPE - Free Report) , and Booking Holdings Inc. (BKNG - Free Report) showed that consumers have been opening up their wallets to get their international summer trip, per Bloomberg.

Three travel companies released their second-quarter results on Thursday, each offering distinct perspectives on what has been promoted as an exciting summer for travel. Despite their differences, they all shared a common trend: and a consumer preference for European or Asian vacations. There is an uptick in prices for various services, including flights, hotels, and short-term rentals.

The strong U.S. dollar is probably leading consumers to go for an international vacation. Invesco DB US Dollar Index Bullish Fund (UUP - Free Report) is up 2.2% in the past three months. Higher pent-up demand in the post-Covid world has also been boosting the international travel.

Inside the Earnings Details

Airbnb slumped on 0.5% on Aug 4 after reporting earnings. The leading platform for unique stays and experiences logged solid beats on both top and bottom lines on after the market closed. Airbnb forecast third-quarter revenue above market estimates on Thursday, but industry fears of cooling U.S. domestic demand weighed on the stock by a light margin.

The company’s earnings of 98 cents per share breezed past the Zacks Consensus Estimate of 77 cents, making it nine successive quarterly earnings beats, on $2.48 billion in sales which topped the Zacks Consensus Estimate by 2.81%. The stock has an upbeat Growth and Momentum score of “A.”

One of the largest online travel companies Expedia Group delivered second-quarter 2023 adjusted earnings of $2.89 per share, up 48% from the year-ago quarter. The figure beat the Zacks Consensus Estimate by 24.6%. Revenues of $3.36 billion rose 6% year over year. The figure missed the Zacks Consensus Estimate of $3.37 billion. This apart, growing gross bookings owing to solid momentum in the ‘booked room nights’ metric was a positive. Shares were up more than 4% on Aug 4. The stock has a VGM (Value-Growth-Momentum) score of “A.”

Connecticut-based Booking Holdings Inc. is one of the largest online travel companies in the world. shares rose more than 12% in premarket Friday trading after the company reported stronger-than-expected Q2 results. Adjusted earnings per share came in at $37.62 a share, striding past the Zacks Consensus Estimate $28.84.

Revenues rose 27% year-over-year to $5.46 billion, topping the Zacks Consensus Estimate of $5.16 billion. Gross bookings jumped 15% year over year to $39.69 billion, ahead of the expected $38.11 billion. “We have seen these strong trends continue into July, and we are currently preparing for what we expect to be a record summer travel season in the third quarter,” said the management, as quoted on Shares rose 7.9% in the key trading session on Aug 4. The stock has a VGM score of “A.”

ETFs to Play

Below we highlight a few ETFs that have considerable exposure the above-mentioned travel stocks. These ETFs offer the opportunity to bet on the travel space at one go.

ETFMG Travel Tech ETF (AWAY - Free Report)

 Airbnb has 5.17% Exposure

Expedia has 4.24% Exposure

Booking has 4.46% Exposure

ALPS Global Travel Beneficiaries ETF (JRNY - Free Report)

Airbnb has 5.42% Exposure

Expedia has 2.29% Exposure

Booking has 4.74% Exposure

Global X E-commerce ETF (EBIZ - Free Report)

Expedia has 4.17% Exposure

Booking has 4.62% Exposure



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