Expect JRNY to Capitalize on Rebounding Travel Industry | ETF Trends

The U.S. stock market climbed Tuesday as energy prices fell, with airline and travel stocks among those seeing notable gains. 

U.S. airline stocks soared on Tuesday on increased revenue predictions. Delta Air Lines, United Airlines, and Southwest Airlines all raised their revenue expectations, maintaining previous statements that demand is robust. 

Travel industry peers Booking Holdings and Expedia Group also made it on the gainers’ board, as did Airbnb and Marriott International – all gaining upwards of 5% or more. 

The move helped ease investor fears that the recent escalation of tensions between Russia and Ukraine into a full-blown invasion would deter travelers for the unforeseen future despite optimism around lessening COVID restrictions.

Several ETFs to consider offer broad exposure to the rebounding travel industry. Three popular options are the ALPS Global Travel Beneficiaries ETF (JRNY), the SonicShares Airlines, Hotels, Cruis Lines ETF (TRYP), and the Defiance Hotel Airline and Cruise ETF (CRUZ).

JRNY is the most diversified of the three offerings and carries an expense ratio of 65 basis points, slightly higher than the category average of 62 basis points. 

JRNY gained 0.79% in February, outperforming the Morningstar Global Markets Index by over 300 basis points, with hotels, casinos & cruise lines being the best performing segment, contributing 1.12% to overall performance, according to ALPS.

Hotels, casinos & cruise lines’ top performer within the segment was Boyd Gaming Corp, which rose over 19% in February as the Nevada Gaming Control released January gaming win revenue of $567.2 million, up 76.41% year-over-year, according to ALPS.

The airlines & airport services segment was the second-best performing in JRNY, contributing +0.35% to monthly performance. According to ALPS, Qantas Airways Ltd, a global air transportation company, gained 9.19% following announcements from Australia and other Asian countries for plans to open borders to vaccinated travelers.

“Despite valuations compressing across many travel-related names to begin 2022, global travel saw a continued relaxing of COVID restrictions that continue to serve as positive catalysts. While uncertainty related to geopolitical conflicts in Eastern Europe has caused volatility in recent weeks, the acceptance of COVID into everyday lives has boosted the travel industry’s prospects through a strong uptick in demand and a reprieve for travelers who are finally able to book their bucket-list trips,” ALPS wrote. 

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