I just had a talk with a friend of mine. He is working at one of the cruise ships. He said that they unloaded all the passengers a few days ago and now they are not sure what the future holds.
When will the cruise industry come back? No one can tell for sure if or when the cruise industry will get back on their feets, but tourism , in general, is far from dead. People will travel again, people will book hotels again and people will book flights again.
Life is like a book. There are good chapters, and there are bad chapters. But when you get to a bad chapter, you don’t stop reading the book! In this case a bad chapter is coronavirus outbreak. No one who survives this crises will stay at home. People cannot wait to go out there.
And when they decide to go out and enjoy the life to the fullest, the last thing they will want to spend their money on is- Cruise Lines. So, forget about investing in these stocks.
There are national parks, sandy beaches, man made attracions all around the world and people will continue to book hotels(and rentals) in order to see these attractions. Two biggest online agencies at this moment are Expedia Group (owners of Expedia.com, Hotels.com and Vrbo.com) and Booking Holdings (owners of booking.com, Kayak.com, HotelsCombined.com and Agoda.com) and they are probably the best bets in this age of uncertainty.
I am not saying to jump right away and buy their shares, I am saying to take a look at the pre-corona prices and compare them to where they are now.
On February 20 the price for one BKNG share was almost $2,000 which was outrageous in my opinion. On Friday the price for BKNG closed at $1,230.68 which is close to $1,000. Almost a 50% price cut in 40 days. Who ever bought those shares back then, well….you know, that was a huge mistake, as coronavirus story was already filling the titles of all online portals.
On the other side Expedia (EXPE) stock price fell even more , it is down 60% from where it was on February 20. The price tag for EXPE closed at $48,71 on Friday. I am going to tell you straight away that, in my eyes, EXPE is not as good bet as BKNG is at the moment. Especially because BKNG have more cash that they can use to weather the storm.
The main question for both BKNG and EXPE is – Where is the bottom? EXPE can, as well as BKNG, still go down in weeks to come, but not too much. BKNG will probably bounce back at $1,100 and EXPE might even go below $30. If EXPE hits $30 mark, that would be a great price, as this was the price for EXPE exactly 8 years ago.
If BKNG hits $1,100 that would be a price that was last seen some 4 years ago. But even if you invest now, with current prices, you wont make a huge mistake as these 2 players are the owners of the best known travel sites in the world.
I am not even going to talk about AirBnB and Trip Advisor at this moment because I am sure Expedia and Booking are better deals.
I wrote this article myself, and it expresses my own opinion. I am not receiving compensation for it (other than from Google Ads). I have no business relationship with any company whose stock is mentioned in this article.