The month of November has been an invigorating one for top leisure stocks so far. In spite of the coronavirus pandemic halting all leisure activities, why is this now the case? Undeniably, this is due to all the recent coronavirus vaccine news. Several coronavirus vaccine candidates are in the final stages of testing. Notably, both Moderna (MRNA Stock Report) and Pfizer (PFE Stock Report) announced hopeful vaccine results with 95% efficacy this month. Not to mention, a third promising contender has entered the final stretch of the coronavirus vaccine race just this week. Together with Oxford University, biotech company AstraZeneca (AZN Stock Report) announced that its vaccine candidate is at an efficacy of 70%. In light of this, top leisure stocks to watch continue to climb in the stock market this month.
For example, leisure stocks ranging from Royal Caribbean (RCL Stock Report) to Six Flags (SIX Stock Report) have skyrocketed by over 40% in the last month. Both investors and industry players appear to be prepping for when the pandemic ends. This is expected as the general public is hopeful and excited to be traveling and spending on leisure activities. For this reason, leisure companies will likely see a rise in client activity. This could be in the form of greater advance bookings as eager consumers plan out their 2021 this year. Regardless, investors have obviously extended their focus towards leisure stocks. Could all this be enough to propel the industry to new heights well into 2021?
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First, we have Carnival (CCL Stock Report). This British-American cruise operator is undeniably a titan in the leisure cruise industry. Rightfully so, as it is the largest travel leisure company globally with a humongous fleet of over 100 ships serving its 10 cruise line brands. Notably, the company is part of the S&P 500 and FTSE 250 indices.
The company share price is up by 15% this week. Carnival along with other cruise stocks are undoubtedly riding the current vaccine tailwind. However, weary investors could be wondering if the company can keep this momentum up after a somewhat choppy year so far. That’s not to worry, as Carnival held $8.2 billion in cash and cash equivalents at the end of its most recent quarter. Despite a net loss of $1.7 billion, the company seems to be in a good position to leverage on the current vaccine news to enhance future liquidity. Will the company be able to make the most of this opportunity-filled time?
In fact, the company appears to have a strategy in place as the holiday season approaches. Its Holland America Line announced its Black Friday offerings earlier this week. The package includes free Wi-Fi for all new bookings and a special bonus gift card with all gift card purchases. To elaborate, the Black Friday Sale also features complimentary specialty dining, a beverage package, gratuities, and more from Carnival’s current Save Now, Cruise Later promotion. In total, this puts the value of the combined offers at up to $2300 per stateroom. Coupled with a similar Black Friday promotion on its ultra-luxury cruise line Seabourn, Carnival is likely targeting adventure-hungry travelers going into 2021. Given all of this, could CCL stock become a top-performing leisure stock this year-end?Top Leisure Stocks To Watch This Week: United Airlines Holdings
Another top leisure stock worth looking at now is United Airlines (UAL Stock Report). The Chicago-based company is a subsidiary of United Airlines Holdings (UAH). United Airlines currently operates in several major U.S. states. Namely, it operates in Chicago, Denver, Houston, and Los Angeles to name a few. Additionally, United Airlines is the largest U.S. carrier flying to the People’s Republic of China and boasts impressive operations throughout Asia. This sets the company apart from the rest of its competitors in the U.S. airline industry.
Interestingly, United Airlines has been in the limelight this week. The stock is seeing gains of over 8% in this time. Conversely, it’s third-quarter fiscal released in October tells a different story. The company reported a massive 78% year-over-year drop in total revenue. This is no doubt due to a 70% decrease in capacity year-over-year due to coronavirus. On the positive side, its total liquidity at the quarter’s end was approximately $19.4 billion. Furthermore, the company also partially offset its losses by reducing total operating by 59% year-over-year. Sharp investors likely see beyond the losses as United Airlines shows its financial management chops in these rough times.
While the recent coronavirus vaccine news has boosted the airline company’s shares, what is it currently doing to take advantage of this? Earlier this week, United Airlines announced plans to boost its Los Angeles-Sydney flights. From December 1 onwards, the company will carry out five flights per week on this route. It states that the flights serve “to support Australian residents needing to return home, medical professionals, as well as the transport of critical cargo shipments of essential medical supplies, PPE, and mail.” In this case, the company shows resourcefulness as well. Strong core operating values aside, is this enough to make UAL stock worth watching?Top Leisure Stocks To Watch This Week: Cinemark Holdings, Inc.
Last but not least, we have Cinemark (CNK Stock Report) on this list. This American movie theater chain is one of the largest motion picture exhibitors in the world. It is currently seeing a surge in share prices along with other movie theater operators. Namely, it saw an increase of 87% over the last month. Could the recent vaccine news be just what the company needs in these dire times?
Admittedly, the company along with the rest of the film industry saw massive losses in the recent quarter. In its third-quarter fiscals announced in September, the company reported $35.5 million in total revenue. It also reports a net income loss of $148 million. CEO Mark Zoradi mentioned that the company’s top priorities remain as “stringently managing liquidity, driving productivity, and reigniting moviegoing”. Despite its recent popularity, Cinemark still has a long road ahead to recovery. Given the company’s strong financial history pre-coronavirus, this could be a good time for investors to buy CNK stocks on the dip.
Cinemark does not appear to be sitting idle. Earlier last week, it announced a landmark agreement with Comcast (CMCSA Stock Report) owned Universal Pictures. Basically, this deal serves to bring theatrical movies to home entertainment in a more efficient way. Movies that earn more than $50 million in opening weekend ticket sales will stay in theaters for at least five weekends. At the same time, titles that do not do so will be available to rent on digital platforms after 17 days. These conditional five weeks of exclusivity could bolster Cinemark’s sales momentum moving forward. Investors will likely be watching the company closely in the coming months to see if this move pays off. All things considered, should you add CNK stock to your watchlist?