On Tuesday the Australian Bureau of Statistics released January’s tourism data and once again it revealed that Australia’s tourism boom continues to gather pace.
On a seasonally adjusted basis inbound tourism increased 1.2% from the previous month or 8.5% from a year earlier.
With tourism growing strongly I expect the following three shares to profit greatly over the next few years:
The Apollo Tourism & Leisure Ltd (ASX: ATL) share price may have jumped 12% since the release of a solid half-year result, but I don’t believe it is too late to grab a slice of the recreational vehicle retailer. For the first-half of FY 2017 Apollo posted an 18.3% increase in revenue and a massive 72% increase in earnings before interest and tax. Based on its full-year net profit guidance of $12.5 million, Apollo’s shares are changing hands at approximately 15x forward earnings. I think this is a fair price to pay for a company growing its bottom line so strongly.
The Mantra Group Ltd (ASX: MTR) share price is down almost 34% in the last 12 months. Concerns over the poor performance of its CBD portfolio are behind the sell-off. Whilst that particular segment’s performance has been underwhelming, the rest of the business continues to perform strongly. I believe the hard work management is putting in to turn around its CBD portfolio will pay off next year, which could make this an opportune time to invest in the leading accommodation provider.
The Skydive The Beach Group Ltd (ASX: SKB) share price is up a massive 45% in the last 12 months. Although this means its shares are now trading at around 28x trailing earnings, I believe the adventure company has strong enough growth potential to justify the premium. This year the company expects to report EBITDA of $21.8 million, up 61.5% on last year. With such a diverse product range offering activities including skydiving, white water rafting, and Great Barrier Reef cruises, I expect Skydive The Beach to be a big winner from the tourism boom.
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Motley Fool contributor James Mickleboro has no position in any stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
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