ASX travel shares are going to be in focus when the ASX share market reopens with global travel being affected by COVID-19 once again.
According to reporting by the BBC, over 8,000 flights in total have been grounded according to FlightAware data tracking.
Different countries are seeing varying levels of impact, but countries like China and Hong Kong are experiencing the worst of the cancellations.
What’s causing the flight cancellations?
COVID-19 is the key culprit, however, more specifically it appears to be the rapidly spreading Omicron variant.
A major difficulty is that large numbers of flight crews and people who run the operations are required to self-isolate after coming in contact with people who have been infected. This is crippling the ability of airlines to fulfil all flights.
Other delays relate to severe weather in the northern hemisphere.
Not only are flights being delayed but individuals are also being impacted. In many parts of the world, a negative COVID-19 test is required before allowed to travel.
ASX travel shares that could be impacted
With how rapidly the Omicron variant is spreading around the world – both in Australia and other countries – the ASX travel share sector might be at least somewhat impacted in almost every market.
Some of the ASX travel shares that may be in focus includes Corporate Travel Management Ltd (ASX: CTD), Webjet Limited (ASX: WEB), Flight Centre Travel Group Ltd (ASX: FLT), Qantas Airways Limited (ASX: QAN) and Helloworld Travel Ltd (ASX: HLO).
However, whilst COVID-19 continues to impact the businesses, there is a longer-term recovery.
Both Webjet and Corporate Travel said that they were starting to see profit from some operating divisions in the second half of the 2021 calendar year as more volume returned and vaccinations were opening up travel corridors.
Do analysts still like ASX travel shares?
Every business is in a different situation, but there are plenty of buy ratings on some businesses.
For example, UBS and Citi both rate Corporate Travel as a buy with price targets that are more than 20% higher than where the Corporate Travel share price is now.
Morgans and UBS both rate the Webjet share price as a buy with price targets that are at least 25% higher than where the Webjet share price is now.
UBS and Morgan Stanley both rate Qantas shares as a buy. The UBS has a price target of $6.20 on the airline. Morgan Stanley’s price target is a huge 40% higher than today’s Qantas share price level.