Markets

Top Analyst: Here Are Two Travel Stocks To Buy

Thailand ()

Thailand ()

The worldwide travel market generated a handsome $2.3 trillion in 2017, and investors will want to capitalize on this lucrative opportunity. Could the right investment translate to a wise investor’s next big summer getaway?

This summer has indicated quite the travel boom. U.S. airlines call for a record 246 million passengers to take flight between the first of June through the end of August. Last year boasted a peak of 237 million passengers. In other words, 2018 has been a stellar year for the travel and tourism arena.

Here, we turn to TipRanks, a platform that tracks the activity of over 4,800 analysts. Using the platform, we can delve into the latest ratings of five-star Services analyst Naved Khan of SunTrust.

Worthy of note, Khan has earned a killer track record on Wall Street, ranked #131 out of over 4,800 analysts. Let’s dive right in to see which two players have hooked Khan’s confidence. (See Naved Khan’s other stock recommendations)

Expedia

Global travel tech group Expedia (EXPE) unleashed a second print last Friday that had shares racing almost 10%. Between stronger-than-anticipated second quarter earnings and a full-year 2018 outlook boost, Expedia investors have a lot to celebrate.

Khan commends Expedia’s quarterly results and adds that “early success on growth initiatives keep us bullish.” Not only is Khan positive on the travel giant’s story, he raises the price target from $170 to $180 (35% in upside potential). The top analyst reiterates a Buy on EXPE stock, as he believes the results “attest to healthy underlying fundamentals and good execution by mgt.”

After all, this was a quarter that saw Expedia add roughly 65,000 hotels compared to 50,000 in the first quarter. Considering Khan had been forecasting roughly 50,000 in hotel adds, Expedia topped his expectations. The EXPE management team maintained that it is tracking to add over 180,000 by the end of 2018, which Khan cheers is more than two times the number of adds seen last year.

“Focus markets seeing early signs of acceleration. These markets where Expedia has aggressively added properties are starting to see a pick-up in room nights growth. While still early, we view this as an indication that mgt's strategy to expand property selection in order to accelerate growth is starting to work,” contends Khan.

The ‘Moderate Buy’ stock has attracted 10 buy ratings in 3 months, 4 analysts playing it cautiously optimistic, and not a bear in sight. With a healthy return potential of almost 16%, Expedia stock’s consensus target price stands at $154.62. See EXPE Price Target and Analyst Ratings Detail.

Booking Holdings

Online travel titan Booking Holdings (BKNG) is raring to post its second quarter earnings show come August 8. It’s been a branding shakeup year for Booking: the company changed names over from Priceline Group on February 21. Since the name change, the stock has vaulted almost 8%.

"We are now doing things that enable people to book hotels, homes, apartments, rental cars, flights, dinner reservations. Booking Holdings unifies all of these different things," CEO Glenn Fogel said. The idea behind the re-branding: “It helps change the perception of what our overall company is.”

Khan is upbeat in his forecast for Booking’s next quarterly showcase, predicting growth in room nights could surpass the company’s guide- especially thanks to an “easier comp.”

“Prospects for a pick-up in BKNG's room night growth in 2H18/19 on easing comps and the businesses' healthy underlying fundamentals keep us positive on the stock,” writes the analyst. Khan reiterates a Buy rating on BKNG ahead of the print with a $2,300 price target (14% upside potential).

The ’Strong Buy’ stock has drawn 12 analysts to its bullish camp, with only 3 hedging bets on the sidelines. Consensus expectations indicate upbeat market sentiment. The 12-month average price target stands tall at $2,283.23, marking nearly 13% in upside potential for BKNG. See BKNG Price Target and Analyst Ratings Detail.

Our database spans over 5,000 stocks. Discover your own top stocks that signal strong upside potential, in any sector you choose. Go to the Nasdaq Smart Portfolio stock screener now.

This article was written by Julie Lamb.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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