As temperatures heat up, summer travel will heat up too. So we decided it was time to go through our stock screener and find the hot performers in the travel industry.
We’ve screened for companies among the major exchanges here in the U.S. involved in the travel industry including airlines, hotels, car rentals, and restaurants.
Market cap had to be greater than $500 million. Seventy-eight companies met these criteria.
From the 78 companies, we looked at their average performance during the summer months (Memorial Day to Labor Day) in the last 5 years. 18 out of 78 have managed to post an average gain greater than 10%, 8 of the top 18 are airlines.
Car Rental Plays
Based on that screener, the best performer has been Dollar Thrifty Automotive, with an average return of 29 percent in the past 5 years during the summer.
John Healy, Research Analyst at Northcoast Research said “Demand trends are favorable and now both the commercial and leisure traveler is being active. At the end of 2009 and 2010 the improving corporate trends helped the industry and now we're seeing some greater traction among leisure travelers, which will help the overall industry. Keeping in mind leisure demand is still north of 15%, so it's still off significantly during peak levels in 2008. This trend is not unusual, typically see corporate business comeback before leisure and that's what we've seen in the last 2 years. We're on the cusp of the turnaround for leisure.”