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Below is an excerpt from a complimentary research note by our Gaming, Lodging & Leisure analyst Todd Jordan. We are pleased to announce our new Sector Pro Product Gaming, Lodging & Leisure Pro. |
Last week’s +20% RevPAR growth number reminded us that these volatile times of year around holidays and very low seasonality, are not easy to predict.
Travel proxies like TSA data suggested there was going to be a small hint of Omicron related impact in the numbers, and then hotels put all time high records in rate and OCC for the corresponding week last week.
So, we’ll keep away from the hard forecasts this week, but again, we’ll flag the TSA data which points to very little Omicron related impact overall.
There was some calendar timing gyrations that impacted the daily growth rates of TSA throughput, especially on Saturday Christmas day, but overall, TSA data has barely slowed despite the explosion in case counts across the US.
Looking to this week, for the 7 days through December 25th (corresponding with upcoming STR calendar), TSA throughput data fell 17% (vs ’19 levels) vs -17% YoY for the prior 7 days. So, very little change and even slower seasonal contributor of Christmas.
We’re not expecting fireworks like last week, but we would not be surprised to see the industry eke out another week of growth. Inevitably there are going to be some slower weeks as travel plans get pushed and cancelled from the case increases, but that leisure traveler is not going away easily.
Our stock takeaways are unchanged as of this AM and we continue to see the most relative value and upside in the stocks, aka “leisure”.
OTAs (EXPE, BKNG, ABNB), Timeshare (VAC), and lower end hotel chains (WH, CHH) should be outsized beneficiaries of these leisure trends we’re monitoring on a daily and weekly basis.
