Chinese Hotel and Travel Stocks Surge Ahead as Holiday Travel Season Approaches
Currently, the Zacks Leisure and Recreation Services Industry ranks in the top 7% of 250 Zacks industries. Notably, several Chinese ADRs (American Depository Receipts) are making significant strides within this highly-rated sector.
As the holiday travel season begins, let’s explore two standout leisure stocks with a Zacks Rank #1 (Strong Buy).
Atour Lifestyle Holdings – ATAT
Atour Lifestyle Holdings ATAT operates the largest midscale hotel chain in China and is generating notable investor interest. Recently, ATAT reported third-quarter results that demonstrated considerable growth in both revenue and earnings.
The company announced Q3 earnings of $0.39 per share, marking a 44% increase from $0.27 per share in the same quarter last year. Sales surged by 52% to $270.55 million from $177.37 million the previous year. Additionally, Atour surpassed Q3 expectations for both earnings and sales by 2%, solidifying its status as one of the most promising IPOs in recent memory after its public debut at the end of 2022.
Image Source: Zacks Investment Research
Trip.com – TCOM
Based in Shanghai, Trip.com TCOM is another key player in the leisure and recreation space, showcasing promising growth potential. The company offers comprehensive travel booking services and exceeded Q3 earnings expectations by an impressive 37% last Monday, reporting earnings of $1.25 per share compared to Zacks’ estimate of $0.91.
Trip.com’s earnings per share grew from $1.00 in the previous year’s quarter, while Q3 sales reached $2.26 billion, a 20% increase from the $1.89 billion anticipated. The stock has been a top performer this year, climbing over 70% in 2024, and has consistently surpassed earnings expectations for nine straight quarters.
Image Source: Zacks Investment Research
With strong demand for travel during the upcoming holiday season, analysts have revised earnings estimates upward for Trip.com in recent weeks.
Image Source: Zacks Investment Research
Bottom Line
Both Trip.com and Atour Lifestyle Holdings are benefiting from favorable earnings estimate revisions, indicating that their impressive stock performances could continue. It is likely that these leading leisure stocks will maintain their upward trajectory throughout the holiday season.
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Trip.com Group Limited Sponsored ADR (TCOM): Free Stock Analysis Report
Atour Lifestyle Holdings Limited Sponsored ADR (ATAT): Free Stock Analysis Report
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The views and opinions expressed herein are those of the author and do not necessarily reflect the opinions of Nasdaq, Inc.
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