Goldman Sachs names its top reopening stocks as England drops travel quarantine rules

Published Thu, Aug 5 202112:00 AM EDT

Lucy Handley @in/lucy-handley-b2b0a61a/@lucyhandley

Analysts at Goldman Sachs have named a number of U.K. and European stocks to buy as travel restrictions start to be lifted, and the bank says several of its picks have potential upside of more than 20%. It comes as England this week removed its quarantine requirements for travelers from the U.S. and EU who have had two Covid vaccine shots, though people will still need to get a test before arriving in England, and take a PCR test on the second day after their return. Along with this loosening of travel restrictions, Goldman noted the population's rising levels of Covid-19 antibodies and falling hospitalizations in an Aug. 2 research note. Goldman publishes its "Reopening Scale for Europe" each week, measuring data including retail sales, job advertising and flight searches. For the week starting July 25, the activity level was 20% below pre-Covid levels, up from 22% below the previous week. On its list of buy-rated domestic-focused companies set to benefit from the reopening were hotel group Whitbread, with a potential upside of 24% to its 12-month price target, stationer WHSmith with 25% upside, and real estate firm British Land with a potential upside of 29%. Spanish infrastructure group ACS also makes Goldman's list, with a potential upside of 41% to its 12-month price target, according to the analysts, followed by French shopping center developer Unibail-Rodamco-Westfield , with 35% upside. The bank likes French foodservice company Elior Group , which it gave a potential upside of 34% to its 12-month price target, while Italian firm Autogrill , another foodservice business, has a potential upside of 23%. "Looking at domestic categories, some leisure-driven categories are at or above pre-Covid levels (motorway traffic, eating out), while others continue to lag (use of cash, office return), potentially indicative of structural changes," Goldman's analysts led by Patrick Creuset stated. In a separate list of buy-rated international company picks, Goldman named British oil firm BP , with a potential upside of 71% to the bank's 12-month price target, as well as airplane engine firm Rolls-Royce with 59% upside and airline easyJet , with 29%. Travel stocks on the list included Swiss airport Flughafen Zurich , with a potential 44% upside to Goldman's 12-month price target, and Airbus , with 27% upside potential. - CNBC's Silvia Amaro contributed to this report.

Brendan McDermid | Reuters