Wall Street investors are seeking out new investments that will help make their portfolios sizzle this summer, as the ongoing headlines of the new market bull run are gaining increasing momentum on the back of companies posting better-than-expected earnings during the first quarter.
Despite the growing sensation that U.S. markets are at the entryway of a new bull market, with the S&P 500 briefly reaching the 4,300 level - a first since August 2022 - some experts remain skeptical over the longevity of the so-called bull run.
According to Bob Michele, Chief Investment Officer at JPMorgan Chase, he said earlier in June, that the current rally reminds him of the 2008 Financial Crash. Several months before the market crashed, a handful of stocks were rallying, only to later falter as the market collapsed.
Elsewhere on the market, other investment vehicles, among one being cryptocurrencies have started stabilizing again, after the news broke that the Securities and Exchange Commission (SEC) have filed lawsuits against bots Binance and Coinbase, two of the world’s largest crypto exchange platforms.
While U.S. market conditions have been anything but favorable for investors against the backdrop of the earlier banking crisis and the U.S. debt ceiling crisis - things could soon begin looking better for some stock options, as the new players draw their attention out of the woods.
Summer Stocks That Could Sizzle
The pandemic may have halted several market categories completely, shattering the markets, and pushing investors into the cold. Now with the majority of pandemic-related fear far behind them, and investors eager to navigate ongoing macroeconomic challenges, here’s a rundown of stocks that could provide investors with some potential upside as the weather begins to warm up.
Airbnb
In 2022, travel conglomerates experienced an exodus of consumer demand, as millions of travelers took to the skies, seas, and roads as pent-up travel demand from the pandemic fueled an outstanding rebound of the travel industry.
Now this year, things might exceed expectations, with more revenge travel on the books for many consumers, despite having to cough up more for airfares, accommodation, and experiences.
The homestay and rental company, Airbnb (NASDAQ: ABNB) is a player that enjoys increased traveler demand during peak summer travel periods. During its Q1 2023 investor letter, the company said that it expects a higher traveler outcome in Q3 2023 and that bookings for nights and experiences have already increased by 19% for Q1 2023 compared to last year.
Furthermore, the company expects even more bookings in the coming months, as travelers are looking to dodge pricey hotels, and looking for more authentic travel and living experiences. Skyrocketing consumer demand and steady forward-looking performance could make ABNB a sizzling stock pick this summer for investors.
Marriott International
Travelers that have the cash to spend this summer, will likely be staying in hotels, and Marriott International (NASDAQ: MAR) could capture a good deal of these consumers, as it holds around 32 hotel brands in its portfolio at the moment, including Courtyard, Westin, and Delta, among others.
Over on Wall Street, analysts and investors are growing increasingly bullish on Marriott, as the company has already had a healthy start to the year, reporting a more than 56% increase in revenue for Q1 2023.
Another factor that’s been driving investors to swoop up MAR shares is the company’s forward-looking strategy to build more than 502,000 new rooms, with more than 200,000 already under construction around the world.
The robust return of international visitation has seen supply and demand for Marriott hotels steadily grow since pandemic-era restrictions have fallen out of place. Now with the company already planning to build nearly 3,060 new hotels, ever-increasing its global presence and footprint, investors need to keep their eyes locked on Marriott this year.
Booking Holdings
The international booking aggregator, Booking Holdings (NASDAQ: BKNG) has already experienced an outstanding year on the stock market, with share prices leaping by more than 29% to date this year.
Like other namesakes in the travel industry, Booking Holdings has already managed to gain a robust rebound from increased travel demand over the last several months. During its Q1 2023 earnings report, the company reported a revenue increase of more than 40% from the year before.
Furthermore, the company is excited to see what the upcoming travel season has in store, estimating that it will see continuous growth throughout much of summer, with strong bookings helping to stabilize share performance.
For its Q1 2023 quarterly report, both net income and free cash flow managed to climb the ranks, rising 138% and 54%, respectively. Overall, BKNG gives investors a strong position on the stock market, despite ongoing economic challenges the travel industry might be facing on the back of higher travel costs.
Avis Budget Group
Still sticking with travel and rental, Avis Budget Group (NASDAQ: CAR), the global car renting company, which operates across 11,000 locations experienced some of the most significant gains since pandemic-related restrictions have ended and consumers took to the roads once again.
Last year alone, share prices made significant improvement, reaching an all-time high of $297 per share. This is an increase of more than 2,609% since March 10, 2020, when lockdown and quarantine restrictions were announced in the United States.
While share performance has since come down, hovering between the $198 and $210 mark, the good news is however that the company recently reported Q1 2023 revenues 5% above the same period last year.
Strong demand and revenue per day helped Avis book more than $2.6 billion in revenues for the first quarter. What’s perhaps the most exciting part, last year the company reported record-breaking revenue of more than $12 billion, and this year could perhaps be another stratospheric year, with estimates outpacing pre-pandemic levels.
Delta Airlines
American airline group, Delta Airlines (NYSE: DAL) recently experienced a two-day stock run on the U.S. market, with prices already up by 17% since the start of June.
Ongoing travel demand, both domestic and international, and leading up to July 4t, could be a record-breaking period for the airline company as it aims to make the upcoming summer season its busiest on record.
Looking at the performance of DAL since the start of the year, prices have already gained more than 30%, and during peak travel times last year, running from July to September, DAL increased its performance on the stock market by roughly 5%.
Overall, Delta holds a comfortable position for investors, not only due to its marketplace influence over other major airlines, but also due to the fact that it operates a forward-looking business strategy that ensures plenty of international routes, multiple city destinations, and servicing major travel destinations for Americans.
Carnival Corporation
After enduring two tumultuous years, with most of its operations going dormant, Carnival (NYSE: CCL) managed to beat expectations last year, returning more than 90 ships to the waters, onboarding over 100,000 employees, and in total welcoming back more than 9 million passengers on its fleet.
For Q1 2023, Carnival reported more than $4.4 billion in revenue, which marked an increase of more than 173% compared to Q1 2022, and 95% higher than pre-pandemic performance.
Already the company has noticed a massive increase in new bookings for the year, seeing more than $5.7 billion in deposits for Q1 2023, setting a new record for the company.
Strong consumer demand against increased advertising and marketing efforts has helped the company stabilize. Forward-looking expectations continue to remain positive, with the company expected to see increased bookings over the coming summer travel months, especially in regions that remain popular for international cruises.
To date, share prices continue to climb, already jumping by 98% this year, and witnessing a 33% increase since the start of June 2023. This could be one of the best years for Carnival, as travelers reignite their interest in cruising.
Final thoughts
Overall, it looks to be yet another record-breaking year for the travel industry, and some household names could be ringing in some major returns on the back of ongoing consumer demand.
With millions of consumers eager to take to the skies and seas again, there’s potential that travel companies and some other namesakes could help further fuel the return of travel, and perhaps the new bull market so many investors and experts are skeptical about.
Related: Will Tech Stocks and the S&P 500 Continue to Rally In June 2023?