Time to Book Some Travel Stocks

With people staying home for safety, the travel sector has been devastated by the COVID pandemic. As of late November, Americans could not vacation in European Union countries, Japan or Canada even if they wanted to. The Centers for Disease Control and Prevention issued a seven-month no-sail order for cruise lines; hotels are operating at less than half-occupancy; and American Airlines, the world’s largest air carrier, reported that third-quarter revenues were down 73% compared with the same period in 2019.

Most travel stocks have been devastated, too, despite a surge when promising test results were reported for three COVID vaccines. Of course, other businesses have been hurt badly by the pandemic as well, but in many of those cases, investors), for example, suffered a 20% decline in revenues over the three quarters ending October 31 compared with the same period in 2019, and a profit of $535 million during that 2019 time frame became a loss of $899 million. Yet the stock has returned 22.8% for 2020. (Stocks I like are in bold; prices and returns are through December 4.)

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