Traveling abroad used to be the choice for many people taking a well-earned vacation, but in this economy, things have changed. Nevertheless, the leisure industry is slowly taking on more vacationers and the leisure related ETF is reflecting the improvements in the industry.
According to a recent survey of travel agents, the top 10 destinations for American travelers this year are all in the United States, writes Carl Kopp for Minyanville. Top destinations include Orlando, Las Vegas and other big cities that offer plenty to do.
Online booking companies saw a sharp decline as potential travelers to Europe were deterred by problems caused by Iceland’s volcano and Greece’s debt problems. The improved exchange rate on the euro and the pound should draw American travelers in the long-term, but right now, home is where the action is.
- Online-travel companies are anticipated to do better the coming months as Americans schedule summer vacations. Priceline (PCLN) has reported that it nearly doubled earnings in the first quarter, but the company is worried about current international events. Expedia (EXPE) announced a 51% earnings increase last month.
- Big hotel names are reporting signs of accelerated growth. Hotel prices have been slashed since 2008 by about 14% in the United States and 10% abroad.
- Airliners may be losing out on the money-conscientious summer vacationer that will be traveling by car, but airline companies are making up the money with increased business from business travelers who are flying on corporate credit. U.S. Airways (LCC) reported revenues were up 35% in the first quarter, Delta (DAL) stated that sales were up 61% year-over-year and American Airlines (UAUA) said corporate travel has almost returned to 2008 levels.
- PowerShares Dynamic Leisure & Entertainment (PEJ)
- Claymore/NYSE Arca Airline (FAA)
Max Chen contributed to this article.