7 Historically High Performing Thanksgiving Stocks

Amid mounting global challenges, it's essential to savor the lighter aspects of life. History shows a bullish trend during the holiday-shortened Thanksgiving week, fueled by increased consumer spending, the surge in holiday travel, and a lower cost of Thanksgiving spread.

Retailers anticipate robust sales during the festive week to turn over a profit for the year. Consequently, they offer discounts and attractive deals on overstocked items, seasonal goods, high-priced commodities, and holiday decor and gifts. Over the past decade, the retail sector has consistently surpassed the S&P 500 during this time frame.

2023 is predicted to witness a record-breaking holiday expenditure during November and December, indicating growth between 3% and 4% over 2022, snowballing the total spent from $957.3 billion to an estimated $966.6 billion. A 2023 Deloitte holiday survey suggests consumers are projected to spend an average of $1,652 during this holiday season, exceeding the pre-pandemic spending levels.

Despite witnessing a dip in October – its first in seven months – U.S. retail sales are expected to rebound. Despite economic uncertainties pressurizing customers, they prioritize holiday expenses during this year's shopping season and are looking for attractive deals and promotions to guide their expenditures.

Approximately 90% of shoppers planning to shop during the Thanksgiving break aim to visit a store to make purchases or collect an online order, with 84% planning to shop online.

Auto manufacturers were grappling amid the United Auto Workers strike. After successful negotiations with General Motors, October 30, 2023 marked the end of the strike. Kelley Blue Book reports that many car dealerships hoarding new vehicles due to fears of scarcity are currently dealing with an oversupply. The average dealership now boasts a 67-day supply of vehicles, although certain brands are still coping with undersupply. The swing in supply could generate lucrative deals for the holiday season.

The airline industry is bracing for the imminent holiday season, expecting record passenger volumes. The Transportation Security Administration projects a staggering 30 million passengers to be screened, potentially setting a new travel record. The pinnacle of this busy stretch is expected to be the Sunday following Thanksgiving, with approximately 2.9 million air travelers anticipated.

According to the Federal Aviation Administration, Thanksgiving flights could peak at 49,606 on the preceding Wednesday – a significant rise compared to last year's all-time high of 48,192. Many airlines are adequately prepared for severe weather conditions, having learned lessons from the previous year when they were compelled to cancel thousands of flights across the country due to adverse weather.

Thanksgiving continues to defy economic headwinds like rising inflation and dwindling consumer savings. Understanding the holiday's implications goes beyond recognizing it as a time for feasting and expressing gratitude; it is also crucial to comprehend its effects on stock market trends.

In the weeks leading up to Thanksgiving, the stock market traditionally experiences more substantial activity as traders recalibrate their strategies. Historically, the S&P 500 has closed the week on an optimistic note three-quarters of the time since 1961, with a median gain of 0.3%.

Furthermore, the S&P 500 has posted positive figures for the week two-thirds of the time, presenting investors with a median gain of 0.75%. Notably, amid the 2008 Global Financial Crisis, the S&P 500 reported an impressive 12% profit during Thanksgiving week.

This article will delve into the influence of Thanksgiving on various sectors like food, beverage, auto, e-commerce, and travel stocks. The seven stocks that could benefit from the holiday week are discussed below:

Amazon.com, Inc. (AMZN)

E-commerce behemoth AMZN is primed to reshuffle the deck of the festive commerce landscape. With a soaring 71.3% year-to-date gain, the company's performance deserves praise. The most recent earnings report depicts an impressive 12.6% revenue surge, hitting a staggering $143.08 billion. AMZN's efforts have been focused on more than just following the market trend, but indeed establishing it.

Market murmurs reflect the awe inspired by the company. Its impressive market cap exceeding $1.48 trillion, coupled with an energetic average volume of 52.49 million, reveals the momentum of AMZN this Thanksgiving.

In a period blossoming with high consumer activity, hundreds of millions of goods are purchased from AMZN. Thus, the company’s fourth-quarter results will provide Wall Street with a comprehensive snapshot of the festive shopping season.

Analysts expect AMZN’s revenue to increase 11.2% year-over-year to $165.85 billion, while EPS is expected to be $0.76, up significantly year-over-year.

Monster Beverage Corporation (MNST)

The Corona, California-based energy drink provider MNST maintains a consistent demand for its beverages, unfazed by frequent price uplifts. The third quarter’s profit surpassed expectations, catalyzed by increased energy drinks and hard seltzers prices.

A decrease in freight and aluminum can costs from the peaks experienced during COVID-19 has inadvertently facilitated the elevation of previously pressured margins.

As of May 2022, MNST beverages have reached the list of top-selling energy drinks in America. The company's momentum will likely persist as a dynamic array of product launches is forecasted to encourage stable growth. A profound distribution network across international markets and a focus on expanding opportunities bode well for future gains.

Bolstered by robust demand trends, sound pricing strategies, and continuous product development, MNST's resilience stands firm. Net sales for the 2023 third quarter increased 14.3% to $1.86 billion. Analysts expect MNST’s revenue and EPS to increase 16.3% and 36% year-over-year to $1.76 billion and $0.39, respectively.

General Motors Company (GM)

2023 is shaping to be a benchmark year for car consumers seeking year-end deals. An unprecedented converging scenario involving elevated inventory levels, significantly increasing interest rates, and traditional holiday discounts is navigating toward big discounts.

Annually, the holiday season witnesses an eruption of optimum offers from car dealerships. Conscious that consumers are more inclined to spend during the festive season, automakers and dealerships deliver enthralling promotions, markdowns, and exclusive deals.

Consequently, after years of observing these seasonal conventions, buyers expect bountiful year-end car discounts, often holding back on purchases until December to avail of them.

For November, GM offers notable cash rebates on various 2023 models. Buyers can expect up to $4,000 off the GMC Sierra 1500 and $3,500 off the Silverado 1500. On average, a rebate of around $1,500 is currently on offer across all GM models.

This tactic could pivotally steer the Detroit-based auto giant's fortunes upward as we enter the holiday season. Amid these developments, for the fiscal quarter ending December 2023, analysts expect GM’s revenue and EPS to be $39.58 billion and $0.97, respectively.

Delta Air Lines, Inc. (DAL)

As Americans traverse the nation to unite with their families during the Thanksgiving season, the holiday is anticipated to act as a definitive marker for the aviation industry's capacity to navigate the year-end festivity period despite facing hurdles of sustained deficit of air traffic controllers.

DAL, bolstered by its strong position, is primed to capture a sizable share of this travel surge. Boasting one of the most comprehensive domestic route networks within the continental U.S., DAL is optimally set up to accommodate these customers.

Being one of the four major carriers dominating over 60% of the U.S. aviation market, DAL persistently demonstrates robust bookings – a trend spearheaded by its premium offerings, which significantly eclipsed the main cabin reservations in recent quarters. Catering to premium passengers has successfully insulated DAL from some of the financial strains budget airlines have faced recently.

DAL projects to witness between 6.2 million to 6.4 million passengers this Thanksgiving, an increase of 5.7 million passengers the airline accommodated last year and is anticipated to surpass the 6.25 million passengers transported in 2019.

DAL emerges as a promising prospect for investors weighted towards capitalizing on dwindling oil prices and the future supply chain improvement. These factors stand to positively impact profit margins within the aerospace industry down the line.

For the fiscal quarter ending December 2023, analysts expect DAL’s revenue is expected to increase 3.9% year-over-year to $13.96 billion, while EPS is expected to be $1.14.

eBay Inc. (EBAY)

With over $20 billion in market cap, EBAY, an established e-commerce heavyweight, is tirelessly striving to attract its consumers' interest and spending power. Customers seeking automotive necessities, smartwatches, and Apple products can reap the benefits of up to 75% discount by commencing their shopping endeavors with EBAY this holiday season.

EBAY constantly refines its strategies to uphold its preeminence in an industry characterized by relentless evolution and revolution. As the holiday season looms, its performance is under intense scrutiny as never before, making its sales forecast a widely watched indicator in the e-commerce landscape.

For the fiscal quarter ending December 2023, analysts expect EBAY’s revenue and EPS to be $2.51 billion and $1.02, respectively.

Conagra Brands, Inc. (CAG)

CAG, a leading North American food company, stands to gain as the anticipated cost of this year's Thanksgiving meal is set to decrease.

American Farm Bureau Federation survey has revealed that the average expense of a conventional Thanksgiving dinner for 10 people in 2023 will be roughly $61.17, or under $6.20 per individual. This reduction is largely attributed to a 5.6% year-over-year decrease in turkey prices and notable reductions in the whipping cream and cranberries prices by 22.8% and 18.3%, respectively.

The declining grocery costs could lead to a sales uptick for CAG this festive season.

Moreover, preparing a Thanksgiving dinner also encompasses multiple stressors, including shopping, planning, and the actual cooking process. However, CAG's sophisticated meal-kit delivery service can eliminate two primary pressure points.

By delivering all the necessary pre-portioned and prepared ingredients required to prepare a mouthwatering meal directly to the customer's doorstep, CAG offers a solution for consumers to enjoy a stress-free holiday season.

For the fiscal quarter ending November 2023, analysts expect CAG’s revenue and EPS to be $3.25 billion and $0.68, respectively.

United Airlines Holdings, Inc. (UAL)

UAL anticipates a record-breaking surge in travelers this Thanksgiving holiday season, projecting significant revenue growth. The holiday travel period, defined as November 17 to November 29, sees the airline expecting to serve over 5.9 million passengers. This indicates a roughly 5% rise compared to 2019 and a significant 13% increment from last year's figures.

UAL plans to operate an average of over 3,900 daily flights to manage the increased traffic, translating to approximately three departures per minute. Therefore, the airline has introduced over 550,000 seats to accommodate high passenger volumes.

UAL attributes its heightened demand to the success of its basic economy pricing option. This economical ticket option allows UAL to compete effectively against rival ultra-low-cost carriers.

UAL’s third-quarter revenue from its basic economy rose 50% annually. UAL’s CEO Scott Kirby credits this substantial gain to the company’s “improved product.”

For the fiscal quarter ending December 2023, analysts expect UAL’s revenue is expected to increase 9.5% year-over-year to $13.58 billion, while EPS is expected to be $1.69.

Top 3 Stocks Investors Should Steer Clear From as Oil Prices Skyrocket

The U.S. WTI Crude prices have escalated to the highest since August 2022, breaking the $95 per barrel resistance level. The international benchmark, Brent Crude, has hit a new record for 2023, beating $97 per barrel.

However, crude oil prices faced significant drops. Brent Crude decreased by nearly 12%, while WTI declined by almost 9%. The sudden crash was instigated by a report from the Energy Information Administration (EIA) citing weak U.S. gasoline demand, resulting in an abrupt shift in market sentiment. Tensions were exacerbated further by a bond market selloff, stimulating concerns about the future of the global economy and oil demand.

Despite the reduction, price levels remain high, potentially instigating economic challenges for industries closely tied to the energy sector.

However, before delving into the implications for related industries, a discussion regarding the reasons behind these unprecedented oil price levels is crucial.

According to the global energy watchdog, the International Energy Agency’s (IEA) Oil Market Report (OMR), global oil demand remains on track to rise by 2.2 million b/d year-over-year to 101.8 million b/d in 2023, fueled by rejuvenated Chinese consumption and increasing demands for jet fuel and petrochemical feedstocks.

According to Standard Chartered commodity analysts' data, the U.S. oil demand demonstrates resilience and outpaces previous forecasts – bolstering the assertion of burgeoning gasoline and jet fuel demands that align with household behavior patterns. The EIA projects an annual boost in initial gasoline demand of 98 kb/d.

Goldman Sachs predicts the persistent demand to culminate in a larger-than-anticipated deficit of up to 1.8 million bpd during the latter half of 2023 and a 600,000 bpd deficit in 2024.

Other factors influencing supply and demand dynamics revolve around OPEC+ and Russia’s orchestrated production cuts and extensive crude draws, suggesting a probable surge in oil prices. Unexpected supply disruptions from Angola, Libya, and Nigeria might enhance oil prices. These elements point to a robustly bullish forecast for the remainder of the year.

Industry analysts project the growing trend in oil prices to persist. Norwegian oil and gas firm Equinor’s chief economist anticipates global crude oil prices could reach $100 a barrel.

Data from the U.S. Energy Information Administration (EIA) unveils crude stocks at the Cushing, Oklahoma storage hub, which is the delivery point for U.S. crude futures, plunged by 943,000 barrels in the fourth week of September to less than 22 million barrels, the lowest since July 2022. This incited an energy price surge.

Although the oil prices have eased, they remain well above and potentially detrimental to numerous businesses. Industries such as air travel and cruise operators, which heavily rely on fuel derived from oil, bear the burden of these soaring prices. Potential consequences include less consumer travel due to escalating airline ticket prices, resulting in repercussions for businesses within the tourism sector. Additionally, profits may decline significantly for chemical companies that utilize large quantities of oil for products such as paint.

Therefore, investors may want to avoid the following three stocks until oil prices decrease more substantially:

Delta Air Lines, Inc. (DAL)

DAL provides scheduled air transportation services for passengers and cargo in the U.S. and internationally.

Crude oil is the predominant raw material for jet fuels and the lifeblood of airplanes. Jet fuel expenses, one of the most significant expenses for airlines, account for 10% and 12% of airlines’ operating costs. Hence, elevated oil prices increase jet fuel costs and can significantly impact the profitability and cash flow of DAL and other similar airline operators.

High oil prices can coerce airlines to compensate by inflating ticket prices or incorporating supplementary charges. Therefore, the interest in air travel, particularly for discretionary and leisure trips, could dwindle, resulting in a decreasing demand.

DAL’s CEO Ed Bastian previously cautioned that elevated oil prices and increased government regulations could catalyze a surge in ticket prices.

Moreover, DAL is known for delivering high-quality service backed by well-trained staff and a customer-centric approach. The company's commitment to uphold these standards and offer amenities inevitably influences ticket prices.

DAL’s oil refinery in Trainer, Pennsylvania, purchased in 2012, processes jet fuel, gasoline, and diesel. The airline company strategized to use this refinery as a hedge against fluctuating oil prices and costs related to jet fuel. However, the strategy was ineffective, as the refinery suffered losses amid maintenance challenges, pipeline disruptions, and unfavorable market conditions.

Moreover, as of June 30, 2023, DAL's adjusted net debt stood at $19.84 billion, marking a 1.3% increase year-over-year.

Recently disclosed quality issues with RTX’s Pratt & Whitney engines are expected to impact the U.S. carrier moderately. The problem arose due to a powder metal defect that may cause cracks in some components of the engines. Despite an initial estimation by RTX of repair work lasting 60 days per engine, it is expected to take up to 300 days.

DAL has trimmed its third-quarter operating margin and profit forecasts as Russia and Saudi Arabia’s extended oil production cuts amplified the airline's fuel expenditures. The carrier anticipates a third-quarter profit ranging from $1.85 to $2.05 per share, a drop from its earlier estimate of $2.20 to $2.50 per share.

Considering all these circumstances, it might be judicious to avoid DAL stock now.

Carnival Corporation & plc (CCL)

A leading provider of leisure travel services, CCL, operating a fleet of over 90 ships accessing nearly 700 ports, faces significant hindrances surrounding fuel costs due to rising crude oil prices. This scenario creates a negative backdrop for CCL and other cruise line operators, where the operational expense, mainly fuel, is expected to spike.

Passenger ticket surcharges are often a response to these inflationary trends. Considering this, CCL’s CEO, Josh Weinstein, indicated that a fuel surcharge is "certainly not off the table." However, this move might trigger a plunge in demand for cruises, particularly with the end of “revenge travel” and grappling with increased inflation. Cruise operators could see their profitability significantly impacted due to burgeoning oil prices, resulting in a notable hit to CCL’s bottom line.

As of August 31, 2023, CCL’s debt (current and long-term) stood at $31.30 billion. Moreover, despite high-ticket pricing driving CCL into third-quarter profitability and narrowing its annual loss forecast, the company anticipates a larger-than-predicted fourth-quarter loss. The predicted net impact of $130 million from advanced fuel costs and unfavorable currency exchange rates could eliminate most of the third quarter's ex-currency, ex-fuel $200 million outperformance.

Also, costs are projected to be further escalated by an assumed 18% rise in dry dock days for maintenance and repairs in 2024.

In 2024, the confluence of CCL taking ownership of three new vessels and a year marked by extensive maintenance could also add further financial strain. Despite potential offsets due to export credits, new capacity will lead to incremental costs and increased capital expenditures. Consequently, this surge in portfolio growth, together with the extended dry-dock days, would likely cut into the following year's free cash flow, even with robust demand.

Given the likelihood of reduced profit margins and dwindling demand due to inflated prices, it may be prudent to approach CCL cautiously.

Akzo Nobel N.V. (AKZOY)

Based in Amsterdam, the Netherlands, AKZOY is a global producer and seller of paints and coatings.

A key component in their production process is crude oil, which creates various elements such as solvents, resins, pigments, additives, and binders. As per some estimates, crude oil derivatives constitute about 40% of the total raw materials required for paint production.

Certain petroleum-based components are indispensable for specific paints or applications, making their substitution challenging without affecting the paint's quality or performance. A direct correlation exists between crude oil prices and the cost of manufacturing paint. Therefore, elevated crude oil prices present significant challenges to paint companies.

Increased oil prices increase the production costs for paint manufacturers, resulting in diminished profitability and growth opportunities for these companies.

Paint companies often transfer these costs to their customers to cope with inflated input costs. However, high prices can negatively affect paints' demand and sales volume, especially in a fiercely competitive market.

AKZOY is experiencing this challenge, making it a potentially less attractive stock option. The company could suffer substantial negative impacts due to lower housing starts in the U.S. and Europe’s weak economic growth.

The company's revenue dropped by 3.9% year-over-year in the second quarter of the year. Furthermore, the Net Debt/EBITDA or leverage ratio for the year's first half increased to 4x, compared to 3.2x during the prior-year period. Higher oil prices are forecasted to decrease its operating income this quarter significantly.

Therefore, these stocks could be best avoided now.

Clear Skies Ahead? Can US-China Flights Propel 3 Airliners for Takeoff?

With the pandemic firmly in the rear-view mirror, consumers are ever keener to redeem their pile of airline miles on other travel rewards on their credit cards for new experiences through “revenge travel.” Revenge travel has its origins in “baofuxing xiaofei” or “revenge spending,” an economic trend that originated in 1980s China when a growing middle class had an insatiable appetite for foreign luxury goods.

Since e-commerce, albeit with a few hiccups in the supply chain, was able to satiate the appetite for goods through the pandemic, Americans are now going above and beyond to compensate for the years spent indoors trying to substitute real experiences with virtual ones.

The trend is expected to gain further momentum with the relaxation of restrictions on international travel that were put in place by China as part of its strict and controversial “Zero-Covid” policy. Consequently, air traffic between the U.S. and China is expected to double in volume by the end of October.

According to an order by the U.S. Transportation Department, each country will gain an additional six weekly round-trip flights as of September 1, up from the current 12, with the total number of flights for each nation planned to rise to 24 by October 29.

In this context, here are three U.S airlines that stand to benefit the most from the persistent tailwind:

On July 13, Delta Air Lines, Inc. (DAL) reported record revenues and earnings for the fiscal second quarter driven by strong demand for international travel, premium seals, and a 22% decline in fuel expenses. The Atlanta-based airline’s adjusted revenue and EPS came in at $14.61 billion and $2.68, compared to consensus estimates of $14.49 billion and $2.40, respectively.

Given that airlines conduct the bulk of their business in the second and third quarters, DAL hiked its 2023 earnings forecast to an adjusted $6 to $7 a share, up from its previous estimate at the high end of a $5 to $6 per share range.

United Airlines Holdings, Inc. (UAL) has also been on a purple patch which has seen the carrier posting record quarterly earnings and forecast a strong third quarter amid an unprecedented domestic and international travel boom.

The carrier’s total revenue came in at $14.18 billion, compared to consensus estimates of $13.91 billion. Its net income came in at $1.08 billion, which resulted in an adjusted EPS of $5.03 for the quarter that surpassed Street expectations of $4.03.

International flights made up 40% of the revenue, but the segment is growing faster than domestic ones amid the overdue relaxation of strict Covid restrictions overseas. 

Despite ten consecutive interest-rate hikes by the Federal Reserve, it isn’t difficult to connect the dots and understand why American Airlines Group Inc. (AAL) has had to turn to bigger airplanes, even on shorter routes, and jumbo-jets, such as the Boeing 747 and the Airbus A380, are being brought back to help ease airport congestion and work around pilot shortages.

As a result of this tailwind, AAL’s revenue for the fiscal second quarter topped analyst estimates to come in at a record $14.06 billion, up 4.7% year-over-year. With the airline’s executives bullish on travel demand, particularly for international trips, the operator has raised its earnings outlook for the fiscal year 2023.

Dark Clouds Around the Silver Lining

If something cannot go on forever, it will stop.” The obviousness of this observation made by Herb Stein was what made it famous.

Amid widespread convictions that pent-up demand for travel will be a multi-year demand set, it is easy to get carried away by the “pent-up demand” and “revenge travel” narrative.

However, the rise of remote work and virtual teams, facilitated by contemporary collaboration and productivity tools, seems to have become an immune and immutable remnant of the cultural sea-change our work and lives had to adopt and adapt to during the pandemic, new reports give us reasons to doubt whether business travel is ever going back to normal.

In such a situation, with traveling for leisure being an occasional indulgence in most of our lives, there are risks that the pent-up demand might not be enough to sustain the momentum that is propelling the growth performance of DAL and other airlines, which are primarily in the business of ferrying passengers.

Moreover, with ticket prices at all-time highs and the stash of pandemic stimulus cash, fueling the leisure travel boom expected to run out over this quarter, it is unsurprising to find tricks and trends, such as ‘skip-lagging’ and consumers trading down on travel being on the rise.

Across the Pacific, with the Chinese economy currently battling triple threats of deflation, chronically high youth unemployment, and an ever-intensifying real-estate debt crisis, it could be unrealistic to expect any appreciable recovery in overseas travel demand among the aging, shrinking, and deurbanizing Chinese population that’s holding on to its savings for dear life amid macro-economic uncertainties that could bring about a lost decade.

Moreover, geopolitical relations between the U.S. and China have been souring because of differences regarding the latter’s territorial claims. The trade war between the two superpowers is intensifying amid restrictions on exports of semiconductor chips and investments in other cutting-edge technology by the former, and the latter upping the ante won’t help matters either as far as civil aviation between the two countries is concerned.


While U.S. air carriers and their Chinese peers would want nothing more than for passenger demand to stay strong and, perhaps, keep growing, the most likely case would be a return to seasonality and cyclicality, as is typical of the airline industry.

However, the possibility of passenger demand falling off a cliff and investors rushing for the exits only to find that the clock struck midnight and the chariot turned back to a pumpkin can’t be completely ruled out.

Either way, every flight that takes off has to land at some point. However, amid widespread tail risks, investors, both current and prospective, would be wise to fasten their seatbelts because the skies ahead are anything but clear.

Is Singapore Airlines (SINGY) an Attractive Buy Despite Denying Air India Stake Increase?

On June 15, news broke that Singapore Airlines Limited (SINGY) had expressed interest in increasing its 25.1% stake in the Tata Group-operated Air India, secured as part of its merger with Vistara that was announced in November 2022 and due to be completed by March 2024. The report claimed that SINGY could gradually increase its stake to 40% to have more skin in the game.

However, the report was soon followed by a denial by SINGY, with its spokesperson confirming that there is no change in SIA’s position from the November 2022 announcement.

However, Goh Choon Phong, the CEO of SINGY, reaffirmed his support by stating, “With this merger, we have an opportunity to deepen our relationship with Tata and participate directly in an exciting new growth phase in India’s aviation market.”

The salt-to-steel conglomerate Tata Group operates three airlines in India: Air India (with Air India Express as its low-cost subsidiary), Air Asia India, and Vistara (a 51:49 joint venture between Tata Sons and SINGY).

The merger of Vistara and Air India into a single entity (Air India), with SIA investing INR 20.59 billion, is under review by the Competition Commission of India (CCI).

With SIA’s expertise in operating a successful airline, particularly when dealing with powerful players such as IndiGo as well as international competition like Emirates and Qatar Airways, it is understandable why Air India might have reportedly been keen on a potential stake increase.
Pinch of Salt

“If something cannot go on forever, it will stop.” The obviousness of this observation made by Herb Stein was what made it famous.
In our June 13 article, we discussed how, despite air carriers turning to bigger airplanes, even on shorter routes and jumbo-jets, such as the Boeing 747 and the Airbus A380, being brought back to help ease airport congestion and work around pilot shortages, Delta Air Lines, Inc. (DAL) wishful extrapolation of the narrative of “revenge travel” could rapidly unravel.

While there remain valid reasons to doubt whether business travel is ever going back to normal and that the pent-up demand might not be enough to sustain the momentum, the battle for Indian skies comes with its own set of challenges.

When the facts, such as 90% of wage earners in India earn INR 25000 or below, the seemingly unending exodus of millionaires from India, and Indigo ordered 500 Airbus aircraft soon after Air India’s combined order of 470 aircraft from both Boeing and Airbus, are taken into consideration, it only takes willful suspension of disbelief to equate low penetration with growth potential.

Hence the possibility that civil aviation in India could be a bubble waiting to burst or at least a profitability sink for air carriers can only be ignored by investors, including SINGY, at their own peril.

Safer Alternative

With The Boeing Company (BA)still on the back foot and playing catch up to its European rival, Airbus SE (EADSY), the latter, with ROCE and ROTC better than the industry average, could be a common denominator that could give investors (relatively) safe exposure to the heated battle for a greater share of the pie of the Indian sky.

5 Best Performing Leisure Stocks to Buy in 2023 Summer

With the pandemic well and truly in the rearview mirror, for most Americans, the onset of summer can only mean one thing: increased consumption. However, e-commerce, albeit with a few hiccups in the supply chain, was able to satiate the appetite for goods through the pandemic.
Hence, Americans are now going above and beyond to compensate for the years spent indoors trying to substitute real experiences with virtual ones. Think camping, cookouts, pool parties, and weekend trips.

Consumers are ever keener to redeem their airline miles on other travel rewards on their credit cards for new experiences through revenge travel.
Consequently, airlines, such as American Airlines Group Inc. (AAL) , have turned to bigger airplanes, even on shorter routes, to help ease airport congestion and find their way around pilot shortages, while Ed Bastion, CEO of Delta Air Lines, Inc. (DAL) revealed, “We’ve had the 20 largest cash sales days in our history all occur this year.”

Moreover, as the consumer price index only grew by 4% year-over-year, which is the slowest in 2 years, a pause in interest-rate hikes by the Federal Reserve could add further momentum to the jump of 0.8% in spending in April.

The increased demand for, and consequently expenditure on, services and experiences are also evident in the recent employment data, with leisure and hospitality adding 208,000 positions out of the expectation-beating private sector employment increase of 278,000 for the month of May. The sector was also a notable contributor to the increase of 339,000 in non-farm payrolls for the month.

Given the above, leisure stocks could be smart investments to capitalize on the increased levels of outdoor activity. Here are a few stocks in the realm of traveling or recreational activities that stand to gain during the summer.

The Walt Disney Company (DIS)

While the global entertainment giant has recently been in the news for its ongoing feud with Gov. Ron DeSantis, outside the political and legal arena, DIS is going through a significant transition under the leadership of its returned CEO, Robert A. Iger.
In addition to the Disney Entertainment and the ESPN divisions, the rest of DIS’ businesses will be organized under the existing parks, experiences, and products division.

As a result, DIS reported significant growth at its theme parks during the fiscal second quarter, which saw a 17% increase in revenue to $7.7 billion, with around $5.5 billion contributed by theme-park locations. Moreover, its cruise business also saw an increase in passenger cruise days as guests spent more time and money visiting its parks, hotels, and cruises domestically and internationally during the quarter.

Marriott International (MAR)

Under various brand names, such as JW Marriott, The Ritz-Carlton, and St. Regis, MAR operates, franchises, and licenses hotel, residential, timeshare, and other lodging properties through two geographical segments: U.S. & Canada and International.

Over the past three years, MAR’s revenue has grown at a 10.6% CAGR. During the same time horizon, the company’s EBITDA and net income have grown at 22.2% and 43.4% CAGRs, respectively.

On June 5, MAR announced its plans to further expand in the affordable midscale lodging segment, following its recent entry into the segment with City Express by Marriott in Latin America.

While the soon-to-be-launched brand has not yet been named, it is currently being referred to as Project MidX Studios. The affordable midscale extended stay brand is intended to deliver reasonably priced modern comfort for guests seeking longer stay accommodations in the U.S. & Canada.

Pool Corporation (POOL)

POOL is a wholesale distributor of swimming pool supplies, equipment, and related leisure products. The company also distributes irrigation and landscape products in the United States.

Over the past three years, POOL’s revenue has grown at a 22.1% CAGR. During the same time horizon, the company’s EBITDA and net income have grown at 37.5% and 37.2% CAGRs, respectively.

On May 4, POOL announced an increase in its share repurchase program to a total authorization of $600 million, along with a 10% increase in the quarterly cash dividend to $1.10 per share.

Acushnet Holdings Corp. (GOLF)

The Fairhaven, Massachusetts-headquartered company designs, develops, manufactures, and distributes golf products. It operates through four segments: Titleist golf balls; Titleist golf clubs; Titleist golf gear; and FootJoy golf wear.

Over the past three years, GOLF’s revenue increased at a 12.4% CAGR, while its EBITDA grew at 18% CAGR. During the same time horizon, the company’s net income has also grown at a 30.6% CAGR.

On February 7, GOLF announced the acquisition of the Club Glove brand, including trademarks, domains, and products, from West Coast Trends, Inc. Founded in 1990, Club Glove is the preferred choice by the overwhelming majority of PGA Tour, LPGA Tour, and PGA Club Professionals, and its patented travel gear has long been recognized among the industry’s most innovative and reliable products.

During the fiscal first quarter that ended March 31, 2023, GOLF’s net sales increased by 13.2% year-over-year to $686.3 million. During the same period, the company’s adjusted EBITDA increased by 22.3% year-over-year to $146.8 million, while the net income attributable to it grew by 15.2% year-over-year to come in at $93.3 million.

Johnson Outdoors Inc. (JOUT)

For Americans who find the great outdoors and road trips more akin to their idea of freedom and the spirit of adventure, JOUT manufactures and markets branded seasonal outdoor recreation products used primarily for fishing, diving, paddling, and camping. The company’s segments include Fishing; Camping; Watercraft Recreation; and Diving.

Over the past three years, JOUT’s revenue increased by 11% CAGR, while its total assets have increased by 11.6% CAGR during the same time horizon.

Due to an improved supply chain situation and increased travel, during the second quarter of the fiscal that ended March 31, JOUT’s net sales increased by 7% year-over-year to $202.1 million. During the same period, the company’s net income came in at $14.9 million, compared to $9.9 million during the previous-year quarter.