Australia is one of the most popular destinations in the world to live and visit. Our biggest cities are frequently voted as some of the most liveable year after year.
This popularity makes some tourism and lifestyle stocks some of the best potential investments on the ASX.
Here are three of my favourite ideas:
Crown Resorts Ltd (ASX: CWN)
Crown Resorts is the largest hotel and casino operator in Australia. Its Melbourne and Perth complexes are major attractions and generate significant sums of money for the business.
Crown is planning on building another complex at Barangaroo in Sydney, which could be another popular destination. Crown is also adding a further hotel at the Melbourne complex.
The short-term negative effects of the loss of some VIP gaming revenue could mean now is a good time to pick up shares. It’s currently trading at 21x FY18’s estimated earnings with a partially franked committed dividend yield of 5.12%.
Sydney Airport Holdings Ltd (ASX: SYD)
Sydney Airport Holdings is the operator of Sydney Airport.
Australia’s biggest city is the largest tourist attraction and the main point of entry for a lot of Australia’s residents and visitors.
In its latest passenger report, management revealed that international passenger numbers had grown by 9.7% in June 2017 compared to June 2016.
Sydney Airport is currently trading at 33x FY17’s estimated earnings with an unfranked dividend yield of 4.77%.
Auckland International Airport Ltd (ASX: AIA)
Auckland Airport is the entity responsible for operating Auckland’s airport. It has a stake in the Queenstown Airport and also has a stake in the Mackay and Cairns airports in Queensland.
New Zealand is receiving significantly more visitors compared to previous years, which is a major boost for Auckland Airport’s numbers.
Auckland Airport is currently trading at 34x FY18’s estimated earnings with an unfranked dividend yield of 2.8%.
It is fairly clear that all three businesses have promising futures. I think Crown is trading at the most attractive value but it could be a rocky road over the next few years if VIP gaming varies and the benefits of the Sydney casino aren’t obvious to the market.
Where to invest $1,000 right now
When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*
Scott just revealed what he believes are the five best ASX stocks for investors to buy right now. These stocks are trading at dirt-cheap prices and Scott thinks they are great buys right now.
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Motley Fool contributor Tristan Harrison has no position in any stocks mentioned. The Motley Fool Australia owns shares of Crown Resorts Limited and Sydney Airport Holdings Limited. 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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