“With lockdowns making headlines, travel stocks are sure to be sold down. We’ve seen this playbook before. During a lockdown, it’s ‘buy’ supermarkets, online retailers and defensives and sell travel companies and shopping centres. As we look like a lockdown is going to lift, it’s the opposite,” she says referring of course to the current lockdown in Sydney.
“With travel once again selling off, it’s time to buy the umbrellas on sale.
“Qantas is reducing commissions paid to travel agents from 5% to 1% from July 2022 so we prefer QAN to the travel agents such as Flight Centre (FLT).
“With the uncertainty around border reopening, we prefer domestically travel related companies rather than international ones.
“Domestic travel and airfares have proven resilient while recovery for international travel continues to be pushed into the future.
“Qantas is well on its path towards recovery. Structurally, its business looks strong.
“While in the midst of a lockdown it can seem that these conditions will last forever, nothing lasts forever – not even lockdowns.
“Qantas is currently our top pick in the travel space,” Julia concludes.
Source: Google
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