The Australian Bureau of Statistics (ABS) has revealed which industries (and ASX shares) could see a bounce after COVID-19.
According to The Guardian reporting, the ABS is looking at Aussie spending habits during the coronavirus pandemic.
The latest survey, conducted in mid-June, is about what Australians are going to spend money on once restrictions are loosened again.
The Guardian quoted ABS head of Household Surveys, Michelle Marquardt, talking about people’s spending intentions: “a majority expected to increase their spending on recreational activities (74%), eating out (74%), private transport (73%), personal care (70%), childcare (66%) and public transport (55%).”
What does this mean for ASX shares?
Well it’s good to see that people do plan to spend more money when restrictions allow. It is spending that makes the economy tick.
Recreational activities could mean a lot of different things. There are plenty of shares this could be applicable to such as: Ardent Leisure Group Ltd (ASX: ALG), Experience Co Ltd (ASX: EXP), Crown Resorts Ltd (ASX: CWN), Event Hospitality and Entertainment Ltd (ASX: EVT), Ingenia Communities Group (ASX: INA), Star Entertainment Group Ltd (ASX: SGR), Sealink Travel Group Ltd (ASX: SLK) and Village Roadshow Ltd (ASX: VRL).
Eating out would probably benefit the food shares listed on the ASX like Domino’s Pizza Enterprises Ltd. (ASX: DMP), Collins Foods Ltd (ASX: CKF), Retail Food Group Limited (ASX: RFG) and Redcape Hotel Group Pty Ltd (ASX: RDC).
Increased spending on personal care would be good for shares like BWX Ltd (ASX: BWX), McPherson’s Ltd (ASX: MCP), Sigma Healthcare Ltd (ASX: SIG) and Australian Pharmaceutical Industries Ltd (ASX: API).
What about travel?
People are also asked about their travel intentions. The ABS survey revealed that 55% were planning to go on a domestic holiday while less than a third were planning an international holiday.
Of the people planning to take a domestic holiday, 20% intended to go within the following month and another 68% planned to go within the following six months. Most people aren’t thinking about an international holiday in the short-term. Of people thinking about an overseas holiday, 44% were thinking about doing it within six to 12 months and 31% were thinking about taking the holiday more than a year in the future.
Shares like Webjet Limited (ASX: WEB), Flight Centre Travel Group Ltd (ASX: FLT), Qantas Airways Limited (ASX: QAN) and Sydney Airport Holdings Pty Ltd (ASX: SYD) are obviously being disrupted by COVID-19 right now, but it’ll be pleasing for them that people are thinking about taking domestic holidays.
Do any of these ASX shares look like buys?
I think there’s a case for many of the shares hit by COVID-19 if you think about the long-term. Shares should be long-term investments. What happens over the next 12 months shouldn’t change your long-term thinking about a business too much, unless it could go bust. I’m not sure about travel shares at today’s prices. The rising case numbers in Melbourne have hurt the prospect of the country being completely COVID-19 free this year, and may limit travel between Melbourne and the rest of the country for a bit longer.
I do believe that shares like BWX, McPherson’s, API and Ingenia could be ones to watch over the next couple of years. I’m quite excited by the prospect of the continuing international earnings growth for BWX and McPherson’s.
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Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended BWX Limited and Webjet Ltd. The Motley Fool Australia owns shares of EXPERNCECO FPO. The Motley Fool Australia has recommended Collins Foods Limited, Crown Resorts Limited, Domino's Pizza Enterprises Limited, and Flight Centre Travel Group 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.