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2 ASX shares to buy for increased Australian travel

kangaroo standing on white sandy beach
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I think the concept of Australian travel is going to be a pretty big deal over the foreseeable future. I don’t know about you, but right now I can’t imagine travelling anywhere else in the world, except for maybe New Zealand. Not Asia, Europe, the United States or the United Kingdom. 

In fact, even achieving the reopening of our own state borders is proving to be a thorny issue in Queensland. Not so much in my home state of WA however; we see things a little differently.

So in a world where travel is likely to be largely limited to within our own shores, which shares are likely to benefit?

Transport for Australian travel

Alliance Aviation Services Ltd (ASX: AQZ) has been one of the real workhorses of the coronavirus pandemic and looks set to emerge on the other side a better positioned company. Alliance saw increased demand for its charter flights during the lockdown period. In addition, the company recorded increases in its fly-in-fly-out flight volumes, something it has nurtured as a core service offering.

Yet, it is Alliance’s recent award of flights to the Whitsundays by the Queensland Government that really tells the tale.  Alliance Airlines is structured as a nimble organisation with a low cost base. If we do have to live only with domestic tourism for a while, I believe the company will prosper. Conversely, a company like Qantas Airways Limited (ASX: QAN) is just too big to survive on local flights alone.

Furthermore, the company has recently completed a successful $91.9 million share placement which will see it well positioned to take advantage of growth opportunities whilst maintaining a strong balance sheet.  

Car parts and accessories

Bapcor Ltd (ASX: BAP) is the Asia Pacific’s leading provider of vehicle parts, accessories, equipment, and services. Some of its well known brands include Autobarn and Midas. It stands to reason that if travel within Australia becomes an increasing trend, many of us will choose to get where we’re going by car. 

Bapcor has grown its sales by an average of 14.9% every year for 6 years. In addition, the company’s share price has grown by an average of ~24% each year over the same period. If the Bapcor share price continues to rise at this rate, it would take just over 3 years to double an initial investment in the company. 

Foolish takeaway

I believe the increase in domestic tourism will provide an opportunity for particular companies to shine. The big international tourism operators like Webjet Limited (ASX: WEB) and Crown Resorts Ltd (ASX: CWN) are likely to see some benefit. But I feel it will mostly be those companies that facilitate regional travel which will really enjoy the spoils of a surge in domestic tourism.

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.

*Returns as of June 30th

Motley Fool contributor Daryl Mather has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Bapcor and Webjet Ltd. The Motley Fool Australia has recommended Crown Resorts 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 Scott Phillips.

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