Cowen analyst Kevin Kopelman updates on the impact of novel coronavirus on hotel and online travel stocks.
"We note that at its peak in May 2003, SARS devastated travel in affected regions, with air tickets and hotel stays down 80-90%+ y/y. We expect the new outbreak to have a similar impact in China until the spread is contained," he warns.
"While near-term impact to numbers will depend on how quickly the outbreak is contained, and whether it spreads materially beyond Mainland China, we remain confident in long-term growth prospects in the Travel category," he adds.
Travel stocks like Expedia (NASDAQ:EXPE), Hyatt Hotels (NYSE:H), InterContinental Hotels Group (NYSE:IHG) and Hilton Worldwide (NYSE:HLT) have underperformed broad market averages for the early part of this year following the coronavirus outbreak.