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Is the travel boom really over?

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Is the travel boom really over?

Hello MM team, With all the commentary about consumers and businesses being pressed to reduce discretionary expenses, travel included, I thought this was a good time to start searching for a holiday bargain. Well, I am finding the opposite: flights fully booked, or very expensive airfares, accommodation in short supply, attractions fully booked, etc. I also spoke to a friend who works in the hotel industry, and she explained they are not at capacity as they were six months ago, but bookings are continuing to flow through at a more typical pace. Talking to other people, it seems many of us were thinking the same: waiting for the travel boom to subside to enjoy a 2024 holiday at a more reasonable price. It seems we are chasing a mirage! All of the above is anecdotal, but made me wonder if there is a bit of a contrarian opportunity in stocks like Corporate Travel or Webjet given the significant price correction over the last couple of months, and the seemingly resilient travel market. Corporate Travel, in particular, reported quite well in August, and their AGM is in a couple of weeks. Thoughts? Thanks, Angela


Hi Angela,

Its a very topical subject, we looked at the Retail Sector on Wednesday morning as the saving buffers built up by many Australians  during COVID dwindle as interest rates and/or inflation bite on people’s finances. There are a couple of factors at play here which we believe need weighing up including:

  • Analysts are forecasting that many Australians savings will be used by March which is likely to put pressure on discretionary spending post-Christmas.
  • We’ve had a few years since COVID to spread our wings and enjoy some travel time after being couped up for well over 12 months, i.e., is the need out of the system and its back to business as normal, just as your hearing from friends.
  • Quality travel stocks like Corporate Travel (CTD) are well off their 2023 highs as they contemplate what comes next.

Overall, in a similar manner to our outlook to retail MM is happy to be on the proverbial fence but if/when we consider a foray back into the travel sector CTD is our likely candidate.

Good luck with the holiday plans!

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Corporate Travel Management (CTD)
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