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Below is a complimentary research note from our Gaming, Lodging, and Leisure (GLL) analysts Todd Jordan and Sean Jenkins. If you are an institutional investor interested in accessing our research email sales@hedgeye.com

GLL | Recovery Will Be Lead By Leisure Travel - 5 18 2020 11 17 37 AM

Welcome to another installment of our very own Hedgeye Consumer Travel Demand Survey.

With Q1 earnings season mostly in the books and more data continuing to hit our screens, we continue to see the likelihood that if there’s any recovery in travel this year, it will be led by leisure travel. We hope this survey should provide an advanced read on how leisure consumers are thinking about their future travel plans.

Whether it’s hotel/resort, vacation rental, or ocean cruise, the survey should provide some color on where consumers might gravitate towards once the social distancing and CDC guidelines are slowly lifted. 

Consumers remain more partial towards hotels & resorts, but judging by overall travel intent, the road to a true recovery will be a choppy one.  Overall, this past week did show a slight uptick week / week for the “likely” buckets and similarly, the “unlikely” buckets ticked slightly lower, too. More indecision amongst would be travelers had been growing over the prior three weeks, but perhaps this week is an inflection. 

Looking ahead, the rate of change and trends within the answer sets are what we’re most keen on following. We plan to run the survey for at least another 5 weeks and hope to provide timely updates. If you are an institutional investor interested in accessing our research email sales@hedgeye.com.

CONSUMER SURVEY RESULTS   

Methodology of Survey

Each week, Hedgeye GLL will receive updated results from their consumer survey questions.  Since the majority of GLL is centered around the theme of “travel,” we geared our survey to directly plug into the wants and desires of potential travelers on a 6-month forward basis.  Our survey is strictly focused on the US consumer and aims to gauge changes in interest levels across time.

Latest Results Commentary

HOTELS & RESORTS

Hotels & Resorts

  • Flattish week / week reading for the “likely” buckets, and consistent with what we have seen in the past month (reading was 15% vs 15% last week, and 16% the prior week).  % for likely to book at Hotels / Resorts still remains well below its highs last month.

  • The % of neutral responses ticked up meaningfully vs last week suggesting some more indecision could be brewing regarding hotel and resort usage.
  • Net/net, the survey spread between “likely” and “unlikely” for Hotels / Resorts took a step back this past week, though still remained fairly negative. i.e. the spread between those unwilling and those willing to book remains near the highs. 

GLL | Recovery Will Be Lead By Leisure Travel - gll.1

Vacation Rental

  • Reading for likely/extremely softened week / week after having dropped to its lowest level in a month just last week. (reading was 7% vs 8% last week, and 8% the prior week)
  • Neutral responses remained flat week / week, so the majority of the change (for the positive) came from the “unlikely buckets.”
  • Net/net, this past week’s reading for Vacation Rentals skews more positive than it has in over 4 weeks i.e. the delta between “unlikely” responses and “likely” are at 4 week lows, which is a pretty big turnaround.

GLL | Recovery Will Be Lead By Leisure Travel - gll.2

Ocean Cruise

  • Reading for likely/extremely likely saw some slight improvement week / week but the data was still near the lows (reading was 6% vs 5% last week, and 6% the prior week)
  • The % of neutral responses were higher this past week, as some indecision rebuilds
  • Net/net, the survey for Ocean Cruise skews marginally more positive than it has in over 4 weeks i.e. the delta between “unlikely” responses and “likely” are at 4 week lows; another reversal similar to Vacation Rental, but also off a low base.
  • Overall, pessimism towards cruise continues to remain elevated, likely a bad sign for future new-to-cruise demand.

GLL | Recovery Will Be Lead By Leisure Travel - gll.3

If you are an institutional investor interested in accessing our research email sales@hedgeye.com