Tag Archives: exclusion filter c & e

Travel and leisure topped list of evolving corporate credit ratings during pandemic | Instant News


The COVID-19 pandemic has been disrupting not only lives and businesses around the world for over a year, but also the credit ratings of major corporations. Corporate credit ratings are a key measure of creditworthiness, but can also determine borrowing costs. They range from AAA to blue chip companies like Johnson & Johnson JNJ, -0.39% and Microsoft Corp. MSFT, + 1.34% to D for defaulting companies. Increasingly, credit ratings may also point to a potential path of recovery for industries hard hit by the protracted public health crisis. Take, for example, travel and recreation, an industry that has seen half of all blue chip companies in the world transition to high yielding, or “junk” status during the pandemic, according to a new report from Credit Benchmark . Even as parts of Europe remain stranded to contain the coronavirus, travel and leisure has seen the highest share of ‘fallen angels’ (at 11.1%) revert to investment grade status during the crisis (see graph below). Fallen Angels, Rising Stars Credit Benchmark The report identified 1,051 fallen angels out of 6,895 companies sampled around the world, or about 15% of the total. He found that about 5% went back to the investment grade. The retail, oil and gas, and auto and parts sectors have also been volatile on the credit ratings front over the past year, according to the report, with migrations between the two main tranches being now a key objective for investors. Read: The next rising stars in the debt world? Probably the Fallen Angels of Businesses Upgrades and downgrades can make a big difference to a business in terms of borrowing costs. The average yield on bonds issued by investment grade US companies is now in the 2.21% range, while it is almost double for those in speculative grade territory at around 4.21%. These rates are important, especially in the past year, as cruise lines including Carnival Corp CCL, -1.52%, Royal Caribbean Group RCL, -1.37% and Norwegian Cruise Line Holdings Ltd NCLH , -2.20%, borrowed billions because their ships were largely idle. See: White House pushes back cruise industry efforts to restart in July, as Florida sues Biden administration But with other ‘clawback’ deals, Carnival shares rose 31.9 % year-to-date Thursday, while those of Royal Caribbean and Norwegian were up about 20%, according to FactSet data. This compares to the Dow Jones Industrial Average’s DJIA, + 0.17%, up 9.5% for the same period, while the S&P 500 SPX Index, + 0.42% was up 9.1%. .



image source

Recovery in leisure travel in full swing, helping airlines | Instant News


A recovery in leisure travel is “in full swing” and airline bookings are on the rise, Bank of America analysts said in a note Monday, raising their expectations for the stock prices of a few US airlines. A “reopening of trade” that began in November alongside the vaccine news helped raise the market capitalization of US airlines by 7% above pre-pandemic levels, compared to 10% below for the United States. Most of the travel industry, including European airlines and US hotels and cruise lines, analysts told me. “With a strong rally reflected in stocks, the ability to meet or beat estimates will be important and will support the theme of ‘getting back to fundamentals’,” they said. They raised the price targets on “a robust reservation dynamic” and “prefer airlines exposed to leisure with good balance sheets”: Southwest Airlines Co. LUV, -1.12%, Alaska Air Group Inc. ALK, – 1.71%, and JetBlue Airways Corp. JBLU, -0.69%. Delta Air Lines Inc. DAL, -1.03% also achieved a target price increase. Shares of major airlines fell alongside the broader stock market on Monday, but saw a rise in March, with American Airlines Group Inc. AAL, -1.00% leading the pack with a 7% gain to now this month, followed by United Airlines Holdings Inc. UAL, -1.83% with a 5% lead. The US Global Jets ETF JETS, -1.39% gained 0.7% in March and is up 17% over the last 12 months, against 55% for the S&P 500 SPX index, -0.13% in the past 12 months. B. of A analysts raised their price targets on Southwest shares to $ 68 from $ 60; on Delta at $ 49 from $ 46; on Alaska at $ 78 from $ 72; and on JetBlue at $ 22 from $ 19.50. Small airline Allegiant Travel Co. ALGT, -4.74% and Spirit Airlines Inc. SAVE, -2.22% also got target price hikes, with the price target on Allegiant rising from $ 245 at $ 260 and the Spirit price target at $ 37 of $ 36. Raymond James analysts also noted the “encouraging” trends in US airline bookings, saying they have been “the strongest” so far in the pandemic. Travel restrictions imposed during the pandemic have devastated airlines, dampening demand for air travel and major airlines around the world to reduce capacity, lay off employees, cut costs and survive on government bailouts. “We expect investors to… (focus) on the overall recovery in income and cash flow, with earnings season feedback likely to be encouraging as the peak summer season approaches,” the reporters said. Raymond James analysts. “Potential risks include the possible moderation of bookings recovery between the spring / Easter and summer break periods and the more resilient COVID variants taking hold.” For business travel, a “significant” recovery in demand is only expected in the second half of the year, they said. The short-term momentum is “the strongest” for JetBlue and Spirit, they said. .



image source

Booking stock gains despite continued erosion of online travel activity | Instant News


Booking Holdings Inc.’s operations continued to struggle with the COVID-19 pandemic at the end of 2020, but held up better than analysts expected. Booking BKNG, + 3.57%, known as Priceline before changing its corporate name to one of its other online travel brands, said fourth-quarter losses on Wednesday of $ 165 million, or 4 .02 dollars per share, down from earnings of $ 27.75 per share. in the same quarter a year ago. Sales fell to $ 1.24 billion from $ 3.34 billion during the 2019 holiday season. After adjusting for some tax impacts and other costs, Booking recorded a loss of 57 cents per share, down compared to adjusted earnings of $ 23.30 per share a year ago. Analysts on average expected adjusted losses of $ 4.28 per share on sales of $ 1.2 billion, according to FactSet. Shares gained around 2% after hours of trading following the release of results. The travel industry came under fire during the COVID-19 pandemic and the decline worsened in the last quarter of the year, with the coronavirus causing more lockdowns. Chief Executive Officer Glenn Fogel issued a note of hope in a statement during Wednesday’s announcement. “The travel environment continued to be difficult during the fourth quarter of 2020 and through January 2021 as the number of COVID-19 cases remained very high and travel restrictions were reimposed in many. regions of the world, ”Fogel said. “However, in recent weeks we have started to see improvements in booking trends which we will continue to monitor.” Although Booking did not provide a forecast for the first quarter in Wednesday’s announcement, analysts expected any recovery to start further into 2021. “Given the likelihood of lockdowns extending as far as in March (notably in the UK) we expect a reset is needed for 1H: 21 Street forecasts (with our estimates) as intra-quarterly travel is muffled, although this should be to some extent within the expectations, ”Stifel analysts wrote in an online travel revenue snapshot earlier this month. “We believe the situation looks more favorable over a 12 to 18 month period for Booking, given the strong leverage effect on leisure travel, exposure to alternative accommodation and the ability to generate revenue.” Investors have been betting heavily on a possible turnaround, as Booking shares jumped over 27% last month and are now up over 36% last year, while the S&P 500 SPX index, +1, 14%, increased by 20.3%. Some of these gains appear to be linked to the initial public offering and early trading by Airbnb Inc. ABNB, + 6.72%, which sells full-residence accommodation instead of hotels – Booking and another rival, Expedia Group Inc. EXPE, + 1.93%, offer similar options in their brand portfolios. “A public assessment of Expedia’s alternative accommodation portfolio in the form of Airbnb seems to suggest a significant pricing error one way or the other” and “a similar argument can be made for Booking on a sum basis parts relating to Airbnb, ”Wedbush analysts wrote earlier this month, while improving Expedia’s stock and raising their reservation price target. Airbnb, which is worth more than Booking despite being considerably smaller, is expected to publish its results for the first time as a public company on Thursday afternoon. Airbnb stock, which sold for $ 68 when it went public in December, closed at more than $ 200 on Wednesday. .



image source

Airbnb’s first profits since its IPO could be an indicator for the travel industry in 2021 | Instant News


Airbnb Inc.’s business was decimated by the coronavirus pandemic, but quickly rebounded to the point that it had one of the biggest initial public offerings of 2020. Now is the time to find out what is expected. for 2021. Airbnb ABNB, -5.19% will report financial results for the first time since going public on Thursday afternoon, ending a blistering year for the company and a difficult year for the travel industry. So far, it appears that the online accommodation booking platform has been better positioned to deal with the pandemic than other companies in the travel industry, as travelers have finally sought out getaways near their homes where they could. avoid other people. Airbnb “has shown it to be more resilient to this particular shock of traveling,” said Tom White, analyst at DA Davidson. Airbnb reported third-quarter profit of $ 219 million, in part thanks to aggressive cost-cutting measures it implemented, on revenue of $ 1.34 billion – its second largest quarter never recorded. But an increase in COVID-19 cases in the fourth quarter led to further travel restrictions, which weighed on other companies in the industry, such as Expedia EXPE, -0.73%, and could also be reflected in Airbnb results – Analysts expect less than $ 750 million in fourth quarter revenue. The prospects offered by Airbnb could be greater for Airbnb and the travel industry. Airbnb released a report at the end of January in which it cited the results of its own survey as saying, “A majority of Americans (54%) have already booked, are currently planning to travel, or are planning to travel in 2021.” It remains to be seen whether travelers will still be pitted against Airbnb’s main competition: hotels. “Unless there is a structural change in traveler behavior, the change in preference is likely to be gradual, especially when hotels are back on a level playing field,” KeyBanc Capital Markets’ Justin Patterson wrote in a recent note. What to expect Profits: Analysts polled by FactSet are forecasting an average loss of $ 8.41 per share, largely thanks to the equity compensation costs of Airbnb’s IPO. Estimize, which brings together estimates from analysts, hedge fund managers, executives and more, expects a loss of $ 6.09 per share on average. Revenue: Analysts are expecting an average of $ 739.4 million in revenue, according to FactSet. The estimate is $ 775.9 million. Stock movement: Airbnb shares gained 35% during their period in public markets, while the S&P 500 SPX index, -0.49%, rose 6.5% during this period. a quarter-over-quarter slowdown in the fourth quarter in Europe and “lingering weakness” in the first quarter. But they said they believed Airbnb would withstand a downturn better than other online travel companies “given its focus on alternative accommodation inventory.” Growth: Airbnb continued to outperform hotels and OTAs in December year over year, KeyBanc analysts wrote in a note, which also said Airbnb and its smaller rival Vrbo had experienced positive growth year-over-year spending in January. The CFRA said in a note that it expects a strong rebound in bookings in 2021, including monthly bookings exceeding previous peak levels by the end of the summer. Regulatory risks: Airbnb faces bans and restrictions on stays or listings in different regions of the world. In his home country, he may also be affected by efforts to amend or reject section 230 of the Communications Decency Act, which, among other things, protects him and other companies based in line, of any responsibility for the words and actions of their users. Sucharita Kodali, an analyst at Forrester, said that if Section 230 “was canceled, it would dramatically change all markets.” Without Section 230, she said Airbnb would have “a lot more than it needs to master,” as it could potentially face lawsuits for rental clauses, property damage and violence. Of 29 analysts polled by FactSet, 10 have a buy rating on Airbnb stock, while 16 have a hold, two say sell and one considers the stock’s overweighting. The average price target was $ 164.65 on Monday, when the stock closed at $ 195.34. .



image source

Travel documents under pressure in London as investors monitor Bristol COVID-19 variant | Instant News


London stocks were heading for weekly gains, but the FTSE 250 envisioned a loss as travel-related names took a hit amid concerns over another potential strain of the coronavirus that causes COVID-19. The FTSE 100 UKX index, + 0.94%, rose 0.2% and is expected to gain 0.8% for the week, as global stocks struggled to propel themselves up and ahead of a public holiday in the US Monday. The FTSE 250 MCX Index, + 0.09%, more focused on the domestic market, fell 0.1% and faces a weekly loss of 0.4%. Fears over the potential impact on the UK of another strain of coronavirus found in Bristol weighed on travel names such as TUI TUI1, -0.95%, down 4%, Carnival CCL, -0 , 87%, down 3.8%, easyJet EZJ, + 0.37%, down 3.4%, and FirstGroup FGP, + 0.13%, down 0.6%, said Joshua Mahony, senior market analyst at IG. “Recent gains in inventory value have been built on the notion that the vaccination program and reopening process is linear and predictable in nature, but tensions in South Africa and now in Bristol highlight the potential to derail that presumption. “, did he declare. Sky News reported that the mutation in Bristol may be able to bypass vaccines as it changes the appearance of the original strain. This is how a top British scientist warned on Thursday that the much more infectious variant of the coronavirus that causes COVID-19, which first emerged in this country, could “sweep the world”. As for larger shares up, shares of AstraZeneca AZN, + 2.91% AZN, + 3.11% rose 1.6%, the day after the pharmaceutical company, which was in the spotlight for its development of a COVID-19 vaccine with the University of Oxford, announced strong full-year results on Thursday. Shares of pharmaceutical company GlaxoSmithKline GSK, + 1.82% GSK, + 1.22% rose 1%. Mining stocks weighed down, with Anglo American AAL shares -0.02% down more than 1% and Glencore GLEN, -0.26% down 1.5%. Elsewhere, new data has shown that the UK economy sank deeper than any other European country in 2020, as confirmed by the Office for National Statistics. It marked the worst recession since the Great Frost of 1709, but the economy grew 1% in the fourth quarter, avoiding a double-dip recession, analysts noted. Opinion: Why the UK economy can quickly turn a corner.



image source