|
Below is an excerpt from a complimentary research note by our Gaming, Lodging & Leisure analyst Todd Jordan. Please contact sales@hedgeye.com to read more of our GLL research. |
The broader trend in hotel demand is clearly picking up led by the pent up leisure customer, but the acceleration on the hotel side remains no match for what’s going on with the alternative accommodation (AA) industry.
We judge the outperformance in AA vs hotels a few ways (app data usage, downloads, desktop tracking, etc.), which we have shared via this email and published notes. But for more evidence of AA’s outperformance, our FL market proxy continues to provide a nice directional signal.
Certainly, there’s a lot of variability in the data and subject to revisions (especially the current month of reported data), but the direction of the booking trends is important.
We recognize that FL is one of the bigger beneficiaries of pent up leisure demand (for now) as its relaxed Covid regulations have given travelers more opportunity to access warmer weather.
So while Florida might not be a perfect proxy for broader leisure travel, it is a good one for the AA market and is likely a solid contributor for the OTAs, particularly VRBO and ABNB who are more dominant in the US market. Recent growth in forward bookings have been very robust, even before the easy comps set in.
Note, FL had a strong 1H of March last year, so the big acceleration was mostly 2H weighted. We don’t have the absolute figures, so we’re looking at this data more for a rate of change signal.
We like the AA space and believe $ABNB is well situated, but have a strong bias towards $EXPE and $BKNG at present and both names feature on our Best Ideas long list.
