Market Health

Which Companies Are Benefiting From No Summer Vacations?

There’s a funny image going around the internet…

It’s a billboard for the movie I Know What You Did Last Summer. And underneath the movie poster, someone added text that says “ABSOLUTELY NOTHING.”

Now that summer has (at least unofficially) begun, this image is painfully real.

Many camps have canceled their sessions. Parents – who have already endured three months of at-home cyberlearning – are looking at another three months of perpetual complaints of boredom until their kids can go back to school… if schools reopen in the fall.

And sadly, countless vacations have been laid to rest. So right now, many of us are looking at a long, hot summer full of “absolutely nothing.”

Unless you’re getting creative.

So today we’re going to cover which companies have suffered due to these dead-on-arrival trips… and which ones are the lucky beneficiaries.

Don’t Expect Free Food on Your Next Flight…

If you had any hopes of hopping on a plane this summer, those dreams have likely been squashed.

And the airline companies are really feeling the hurt…
Airline StocksSouthwest Airlines (NYSE: LUV), Delta Air Lines (NYSE: DAL), American Airlines (Nasdaq: AAL) and United Airlines (Nasdaq: UAL) posted losses in the first quarter.

And they warned that the road to recovery would be slow – even taking years. The demand just isn’t there right now.

The real salt in the wound came when Warren Buffett’s company, Berkshire Hathaway, sold its entire stakes in all four carriers.

Beyond airlines, other vacation-dependent stocks are having a rough 2020 as well…
Vacation StocksOnline travel companies like Expedia Group (Nasdaq: EXPE) and Tripadvisor (Nasdaq: TRIP) are understandably struggling. Since no one knows when countries, states or tourist attractions will reopen, it’s nearly impossible to plan a new trip right now.

Plus, some of the worst victims have been cruise lines, like Carnival Corp. (NYSE: CCL) and Norwegian Cruise Line Holdings (NYSE: NCLH). Because – let’s face it – cruise ships are essentially gigantic floating petri dishes.

None of these falling knives should come as a surprise. And the timeline for “back to normal” is just a stab in the dark. In the meantime, the pandemic has an indefinite hold on all adventure planning.

Unless you’re thinking outside the box…

On the Road Again

I’ve never traveled in a recreational vehicle (RV), but I’m starting to see the appeal.

When you think about it, traveling in an RV is essentially the happy medium between camping and hotel hopping. None of the discomfort (or the lack of showering) of camping… and none of the cleanliness concerns of hotels or motels.

You can drive anywhere you want – whether that’s coast to coast or just down the road to a national park. And there are no flight delays, port calls or reservations.

Plus, you never have to share public facilities if you don’t want to.

This summer, it seems a lot of people are coming to the same conclusion…
On The Road AgainRV plays Thor Industries (NYSE: THO), Winnebago Industries (NYSE: WGO) and Camping World Holdings (NYSE: CWH) have been the lucky beneficiaries of all our travel woes.

That’s because the trends and timing have played out nicely for the outdoors industry.

For one thing, people aren’t keen on traveling in the traditional ways, as we’ve already discussed.

And for another, hiking, camping and fitness are just a few industries that are thriving thanks to younger generations.

Millennials are starting families now. So not only are they driving these outdoorsy trends, but they’re opening up their wallets. (Or, more likely, their Amazon Prime accounts.)

Skills like fishing, kayaking, canoeing and rock climbing are very much en vogue. Not to mention, in the throes of quarantine, many of us are craving more time outside.

Don’t get me wrong: Millennials love their electronics and Instagram feeds. But this generation can remember life both before and after iPhones.

So there’s a conscious effort among those in this age group to balance technology with simplicity… and novelties like road trips.

“I’m Not Dead Yet”

This summer, you can expect less jet-setting and fewer stamps on your passport.

Even closer to home, you’ll be without camp, pool parties, barbecues, concerts and festivals.

But that doesn’t mean you can’t find adventures and make new memories.

Summer vacations aren’t dead, per se. They’re just going to look a little different in 2020.

Good investing,


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