The ongoing coronavirus outbreak has sent ASX travel shares falling lower in 2020.
However, some of the biggest travel-related stocks are on the market are set to report their earnings this week. Here's a look at what's in store for each stock and who could be the big winner.
Why these ASX travel shares are under pressure
The Webjet Limited (ASX: WEB) share price is down 0.77% since the start of the year on fears of lower bookings, and as a result, earnings. And Webjet is far from the only Aussie travel stock to be under pressure this year.
The Qantas Airways Limited (ASX: QAN) share price has plummeted 9.77% since the start of January. Shares in the Aussie flag carrier have been hit by similar fears over the business impact of coronavirus, or COVID-19.
Travel restrictions and public fear have combined to reduce tourist numbers. That spells bad news for these ASX travel shares as well as Sydney Airport Holdings Pty Ltd (ASX: SYD).
If there are less flights coming into Aussie airports, that means less traffic and lower earnings. While domestic travel shouldn't be too badly affected, it's international flights that could see reduced passenger numbers.
Can these companies surprise in February?
It's always hard to guess which way earnings will go in a given reporting season. It all comes down to whether or not these ASX travel shares can hit estimates.
The coronavirus impact has been largely confined to 2020, which means the companies financial positions at 31 December 2019 should be unaffected.
However, investing is as much a psychological game as an analytical one. Therefore, these ASX travel shares could be in the buy zone right now.
I'd expect to see some strong numbers from these companies this week, but many investors will be watching for commentary on the coronavirus impact.
I'll be watching for Qantas' fuel costs and key efficiency metrics this week. The Aussie airline is pushing the limits with its ongoing flight tests from Sydney to London and innovation could be key.
If booking numbers are high for Flight Centre, and international traffic is strong for Sydney Airport, then keep an eye on their share prices this week.
