FOXTROTS*

 

December travel stocks – another bad month

Following almost-universal falls in travel stock prices in October, they were almost as bad in the last month of 2018. In Asia Pacific, Europe, US in December:

 

Airlines: biggest growth, Korean +4%; biggest fall, Hawaiian -34%. Hotels: Shangri-La +5%, Wyndham -14%. Tech: Lastminute +8%, eDreams -27%. Others: Genting +27%, Hertz -27%.

 

Previous month: Airlines: biggest growth, China Southern +26%; biggest fall, Easyjet -7%. Hotels: Wyndham +16%, NH Hoteles -16%. Tech: Travelport +2%, cTrip -13%. Others: HNA +37%, Thomas Cook -33%.

 

TBA Travel Stocks Index: World 206, Asia Pacific 96, Europe 175, US 345. Index previous month: World 222, Asia Pacific 98, Europe 184, US 384.

 

NVTT (Net Value Travel Tech) Stocks Index: 115; previous month 126.

 

Stockmarkets. Biggest growth Kuala Lumpur +1%; biggest fall Tokyo -10%. Previous month: biggest growth Hong Kong +6%; biggest fall Dublin -4%.

 

Comments:

Of the 81 travel stocks we track monthly, only 17 grew, of which nine were in Asia Pacific.

 

Among airlines (14 in AsPac, 10 Europe, 7 US) only Air New Zealand, Korean Air grew – none in Europe or the US.

 

Among hotels (10 in AsPac, 5 Europe, 9 US), we show Shangri-La as fastest. It was actually Belmond, +38%, but during the month that company agreed to be bought by luxury-group LVMH, boosting its stock price. However, it was actually one of the few companies to have grown in 2018; it was +50% above its end-2017 price before the LVMH offer was made public.

 

Of note is the market’s reaction following Jinjiang’s offer to buy the rest of Radisson Hotels from the (still)-troubled HNA group – JJ’s shares fell -10% in the month.

 

(Separately, HNA’s price – in our ‘Others’ category – fell in nine of the past 12 months, and ended the year -65% below its end-2017 price.)

 

We have long-thought that travel-tech companies (0 in AsPac, 3 Europe, 5 US) would perform better than other travel stocks. But more often more recently, travel-tech has matched the market.

 

In December, only two of our eight grew, and only three (including those two, Lastminute and Travelport) were above their end-2017 prices.

 

Among ‘Others’ (3 in AsPac, 8 Europe, 7 US) one notable fact in 2018 was the fall of the world’s two leading car-rental companies, Avis and Hertz. They almost take it in turns to be worst performer in our ‘Others’ category each month. Over the year Avis was -49% below its end-2017 price, Hertz -38%.

 

Stockmarkets (10 in AsPac, 9 Europe, 5 US) also had a bad month. Our best performer, Kuala Lumpur, was actually the only one to grow. And almost as bad as Tokyo was the -10% of Travel Weekly’s stock index in the US. (They are rounded; Tokyo was -10.5%, TW -10.3%.)

 

China stocks (6 plus 2 US-quoted) all fell – even its three main airlines (Air China, China Eastern, China Southern) which are do so well in business terms. If these falls are a reaction to the trade war started by the US, surely this is over-reaction?

 

 

Info from Travel Business Analyst. Details in next month’s editions of WYSK: What-You-Should-Know, published by Travel Business Analyst – which will include annual comparisons, as well as 5-year, 10-year, and millennium comparisons.

 

 

The Fox. Remember, I’m an industry expert in the parallel world.

*Fox – sly.  Trots – left-leaning (Trotsky) plus its more insalubrious meaning.  Foxtrots – leading the industry in a dance.

 

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