MENU

3 tourism shares that could provide market-beating returns

During earnings season in February the tourism sector was the stand out performer in my opinion.

Countless companies delivered better than expected results thanks to the tailwinds of the inbound tourism boom and the growing number of outbound trips made by Australian travellers.

Three shares which I expect to continue benefiting from these tailwinds are listed below. Here’s why I think they are capable of delivering market-beating returns:

Crown Resorts Ltd (ASX: CWN)

I believe that this casino and resorts operator is likely to be a big winner from the tourism boom that Australia continues to experience. As more and more tourists flock to Australia’s capital cities, I expect Crown to see demand for its accommodation rise strongly. This could lead to Crown Resorts enjoying higher occupancy levels and rooms rates, ultimately leading to an increase in its profits and dividend.

Corporate Travel Management Ltd (ASX: CTD)

Arguably the strongest result in the travel and tourism sector during earnings season was the half-year result of Corporate Travel Management. During the first-half of FY 2018 the corporate travel manager reported a sizeable 33% lift in underlying half-year net profit on the prior corresponding period to $36.4 million. Although its shares have risen strongly since that release, I think 30x estimated forward earnings makes them decent value based on the company’s current growth profile.

Webjet Limited (ASX: WEB)

The next best half-year result during earnings season would have to have been Webjet’s. Thanks to the tailwinds it is experiencing from the shift to online travel booking, Webjet once again outperformed the market’s expectations with a 45% increase in net profit after tax before acquisition amortisation from continuing operations. I expect more of the same in the second-half, which could lead to Webjet smashing its full-year EBITDA guidance of $80 million. So, considering its growth potential and the fact that its shares are changing hands at 26x estimated forward earnings, Webjet would have to be my first pick in the industry.

Looking for more shares with strong growth potential? Then don't miss out on these star stocks.

Top Growth Shares To Buy In April

For many, blue chip stocks mean stability, profitability and regular dividends, often fully franked..

But knowing which blue chips to buy, and when, can be fraught with danger.

The Motley Fool's in-house analyst team has poured over thousands of hours worth of proprietary research to bring you the names of "The Motley Fool's Top 3 Blue Chip Stocks for 2018."

Each one pays a fully franked dividend. Each one has not only grown its profits, but has also grown its dividend. One increased it by a whopping 33%, while another trades on a grossed up (fully franked) dividend yield of almost 7%.

The names of these Top 3 ASX Blue Chips are included in this specially prepared free report. But you will have to hurry. Depending on demand - and how quickly the share prices of these companies moves - we may be forced to remove this report.

Click here to claim your free report.

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Corporate Travel Management Limited and Crown Resorts Limited. The Motley Fool Australia has recommended Webjet Ltd. 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 Scott Phillips.

Two New Stock Picks Every Month!

Not to alarm you, but you’re about to miss a very important event! Chief Investment Advisor Scott Phillips and his team at Motley Fool Share Advisor are about to reveal their latest official stock recommendation. The premium “buy alert” will be unveiled to members and you can be among the first to act on the tip.

Don’t let this opportunity pass you by – this is your chance to get in early!

Simply enter your email now to find out how you can get instant access.

By clicking this button, you agree to our Terms of Service and Privacy Policy. We will use your email address only to keep you informed about updates to our website and about other products and services we think might interest you. You can unsubscribe from Take Stock at anytime. Please refer to our Financial Services Guide (FSG) for more information.