Investors buying travel stocks hope hotelier Trump will water down protectionist campaign promises

Trump and the travel business

In January, when a new president takes office, it will be occupied by a business man who happens to be part-hotelier and part-golf course owner.

Although Donald Trump has been at the helm of a global business that includes golf courses in Dubai and Scotland, and hotels in Canada, Ireland and soon in Brazil, his nationalist rhetoric on the campaign trail included talk of fencing off Mexico, vetting Muslims entering the U.S., and calling China a currency manipulator.

In other words, it's not exactly the kind of talk that is likely to draw hordes of travelers to the U.S. from other parts of the world.

"Trump's policies and persona represent a real market risk if they translate into antipathy towards the U.S. in general and dissuade travel to the U.S.," said a recent report by Oxford Economics, a global advisory firm affiliated with Oxford University's business college.

However, the report also stated that the strong U.S. dollar and slower global growth could ultimately be bigger factors that could weaken overseas travel to the U.S. in the next year.

Hotels and leisure shares have mostly outperformed the broader markets since Election Day. There are hopes that $650 billion in tax cuts under the Trump administration will mean more spending on travel. Marriott International has rallied 7 percent, more than double the gains for the S&P 500 in the same time period. Hilton Worldwide and Intercontinental Hotels shares have gained over 6 percent and 5 percent, respectively.

Donald Trump plays a stroke as he officially opens his new multi-million pound Trump International Golf Links course in Aberdeenshire, Scotland.
Andy Buchanan | AFP | Getty Images

As for Trump's own business, close to 54 percent of people surveyed by travel researchers at Skift said they would be "less likely" to stay at a Trump hotel now that he has been elected president. The survey polled more than 1,500 people in the three days after the election.

About 29 percent of respondents said they would be more likely to do so, while more than 17 percent said they weren't even aware Trump was in the hotel business.

Still, marketing consultant Brand Keys is calling the Trump name "the most powerful brand in the world" right now, adding 25 percent added value to products and services with "Trump" on it. They compare that to most celebrities who generally add 12 percent to 15 percent to a product's value.

Brand Keys also asked more than 1,200 registered voters their views of the Trump brand before and after the election. The findings show that the perceived worth of the president-elect's name has now even surpassed precandidacy levels.

An example of the increased interest is the newly opened Trump Hotel in Washington, down the street from the White House.

A hotel representative said "business has steadily increased" in its third month of operations and the hotel is already completely booked for Inauguration Day on Jan. 20.