“A Slow Thaw for Travel and Leisure Stocks - BusinessWeek” plus 1 more

A Slow Thaw for Travel and Leisure Stocks - BusinessWeek

Posted: 07 Mar 2010 06:07 PM PST

Although vacation bookings are rising with optimism about the economy, prices for hotel rooms and cruises will need time to rebound

With the worst of winter's weather apparently over, spring break and summer getaway destinations are beckoning. If you really want to take the pulse of American consumers amid nagging doubts about the economic recovery, check out their vacation plans. That kind of big-ticket item—among the most discretionary of purchases—shows how much confidence people have in their future.

"When it comes to vacations, when consumers are as traumatized as they were in the fourth quarter of 2008, all major purchases are put on hold. A vacation for most people is a major purchase," says Sharon Zackfia, an analyst who covers cruise lines for William Blair. "Until people felt better about their 401(k)s and job security, you had to wait."

Vacation bookings started to pick up in November and have accelerated so far this year, according to travel agents and analysts. That's largely due to growing confidence in the economy, says Robert Zavala, president of Freedom Vacations, a Downey, Calif., travel company.

Bookings at dude ranches in the western states are materially better this year than in 2009 but nowhere near 2008 levels, says Bill Bryan, chairman of Off the Beaten Path, a Bozeman, Mont., company that specializes in adventure travel packages. As of Mar. 1, total business for the 10 tour operators that comprise the Adventure Collection, of which Bryan serves as vice-chairman, was up 23% from a year ago, but Bryan doesn't expect business to rebound to 2008 levels until sometime in 2011.

slim booking window triggers bargains

In the cruise business, consumer confidence is measured by how far in advance people book travel, which is called the booking window. This measure contracted to as little as two months in late 2008, vs. an historical average of six months. Now it has returned to about five months, says Steven Wieczynski, an analyst at Stifel Nicolaus (SF) who covers cruise lines and gaming.

A sharp narrowing of the booking window such as the one that occurred last year translates into big discounts on prices because cruise ships like to sail full, says Zackfia at William Blair.

The booking window remains around two months for cruises that depart from South Florida and Puerto Rico, says Victor Valverde, owner of Cruceros To Go in San Juan, P.R. Currently, you can get a seven-day cruise out of San Juan, Fort Lauderdale, Fla., or Miami for $500 to $600—"unheard of" just a few years ago, when the cost was typically between $700 and $800, he says. South Florida offers the biggest discounts because there is such a glut of available ships there, he adds.

Prices for summer cruises seem to be running 5% to 6% higher than in the summer of 2009 but remain below 2008 levels, and prices for longer, more expensive cruises are rebounding more quickly than those for shorter ones, says Zackfia. Most Alaskan cruises slated to sail between May and July are already sold out, she adds.

Carnival (CCL) said during an earnings conference call in December that its bookings were up 40% from a year earlier and business likely had improved further by January, when Royal Caribbean Cruises (RCL) reported its latest results, says Zackfia. She upgraded both stocks to buy in March 2009 and believes that both companies are still in the early stages of a price recovery around itineraries. The stock prices aren't reflecting this yet, but eventually they will follow, she says.

Vegas Midweek room rates have plunged

The outlook is much gloomier for the gaming industry. The main problem Las Vegas faces is a lack of convention business, says Wieczynski at Stifel. Convention attendance fell nearly 24% from 2008, to 4.5 million for all of 2009, according to the Las Vegas Convention and Visitors Authority. Some improvement is projected to come later in 2010, says Wieczynski, but he warns against expecting it to return to normal levels for a couple of years.

Five Filters featured article: Chilcot Inquiry. Available tools: PDF Newspaper, Full Text RSS, Term Extraction.

Travel smart - Detroit Free Press

Posted: 07 Mar 2010 12:38 AM PST

Hell has frozen over. The hotel chain that just won Travel & Leisure magazine's award for best room design is -- drumroll please -- Motel 6.

Its new "Phoenix" design for its low-budget hotel rooms features faux-wood flooring, ambient lighting, a pedestal bed that lets you store your luggage underneath and an entertainment unit with flat-screen TV, wardrobe and plug-ins for MP3 players. It also has black granite countertops and walk-in shower in the bathroom.

"Bright color on the walls and lots of rounded-off corners and beveled edges make for a fresh, pop-modern look," T&L judges said in the March issue of the magazine.

It's the first redesign in 12 years for Motel 6 rooms and is being introduced around the country. The Ann Arbor Motel 6 (3764 S. State St., 734-665-9900) already has the new interior (www.motel6.com).

Five Filters featured article: Chilcot Inquiry. Available tools: PDF Newspaper, Full Text RSS, Term Extraction.

Travel and Leisure

Sunday, March 7, 2010