Tourism may be one of the few industries exposed to a true tailwind.
There are a number of different elements all coming together to boost tourism numbers.
Baby boomers are retiring and want to explore the country, or the globe, in their golden years.
House prices are putting off the idea for younger people of owning a home, so travelling seems like a better use of money.
Australia is becoming more accessible for Americans, Europeans and Asians who want to visit the country.
That's why I'm interested in the following two shares:
Sydney Airport Holdings Pty Ltd (ASX: SYD)
Sydney Airport could be one of the most direct ways to access the growth of tourism numbers. Indeed, it benefits from incoming and outgoing tourist numbers.
Every month the business releases news of further passenger traffic growth. International passengers are the key driver of the growth, year to date at September 2018 international passengers were up by 4.8%.
The number of passengers from a number of countries continues to grow strongly. In September USA passengers were up by 8.3%, Indian passengers had grown by 13.6%, Japanese passengers were up by an impressive 15.7% and Malaysian passengers had gone up by 12.2%.
It's currently trading at 33x FY19's estimated earnings with a yield of 5.7%.
Crown Resorts Ltd (ASX: CWN)
Crown Resorts owns some of Australia's leading casino resorts in Melbourne and Perth. Each location generates a large amount of earnings for Crown and it's now constructing Crown Sydney, which would be another big earner for the company when it's completed in a couple of years.
Some people want to stay at the best hotels they can, perhaps do a bit of gambling.
Crown just held its AGM and gave a trading update for July to 28 October. Australian resorts main floor gaming revenue (excluding VIP program play revenue) was down 0.6%, but Australian resorts non-gaming revenue was up 3.5%.
Pleasingly, VIP program play turnover at the Australian resorts increased by 13%.
In the short-term Crown offers a decent return with a partially franked dividend yield of 4.9% whilst Crown Sydney could be a big boost in the medium-term. It's trading at 20x FY19's estimated earnings.
Foolish takeaway
Both Crown and Sydney Airport are experiencing pleasing earnings growth. However, with rising interest rates I think Crown is better value based on the lower valuation and the hopefully-large increase in earnings in three years.