How Are Analysts Rating Travel and Tourism Stocks?



Analyst ratings

Delta Air Lines (DAL) has the most favorable rating from analysts—86.7% of the analysts rate it a “buy.” Priceline is second with 82.4% of the analysts rating it a “buy.” Hilton is third with 81.5% of the analysts rating it a “buy.” It’s important to note that 75% of the analysts have a “buy” rating on both United Continental (UAL) and Spirit Airlines (SAVE), while 72.7% have a “buy” rating on Allegiant Travel (ALGT). Meanwhile, 67.9% have a “buy” rating on Expedia (EXPE), 66.7% have a “buy” rating on Wyndham (WYN) and Alaska (ALK), and 64.3% have a “buy” rating on JetBlue (JBLU).

Article continues below advertisement

At the same time, 58.8% of the analysts rate Southwest Airlines (LUV) as a “buy,” 57.1% of the analysts rate Marriott (MAR) as a “buy,”and 50% rate American Airlines (AAL) as a “buy.” For Starwood (HOT), only 8.3% of the analysts recommend a “buy” due to its ongoing merger with Marriott. Read Marriott-Starwood Merger: Welcome the World’s Largest Hotel Chain to learn more.

Return potential

Airlines seem to have the highest return potential among travel and tourism stocks. Delta Air Lines has the highest return potential of 30.8%, followed by Spirit with a 27.9% return potential, and JetBlue with a 26.6% return potential, according to Wall Street analysts’ recommendations. Southwest comes next with a return potential of 24.6%. Wyndham has a 20.6% return potential, Alaska has a 20.4% return potential, and Allegiant has a 20.3% return potential.

Marriott has a 17.9% return potential, followed by Expedia with a 15.8% return potential, and Hilton with a 15.3% return potential. United has a 13.9% return potential, American has an 11.6% return potential, Hyatt has an 8.8% return potential, and Priceline has an 8.5% return potential.

TripAdvisor is the only stock with a negative return potential of 2.3%.

Investors can gain exposure to airlines by investing in the iShares Dow Jones Transportation ETF (IYT). They can gain exposure to hotels by investing in the iShares Russell 1000 Growth ETF (IWF).

In the next part, we’ll see how the stock market reacted to the merger news.


More From Market Realist