Are You Ready to Travel?

I think it’s safe to say that we’re all getting a little restless when it comes to COVID-19.

It’s officially been over a year since the restrictions were implemented to reduce the spread of the virus. Restrictions that most of us thought would only last for a few weeks are still very much part of our everyday lives. Here in Baltimore restrictions have been gradually lifting and the maximum capacities of people inside and outside restaurants and bars have started to increase.

It has a lot of people —  including myself — optimistic about getting back to a semblance of normalcy or at least having the chance to dine at my favorite restaurants and bars again. This optimism has been a long time coming, and it’s being driven by the decreasing number of coronavirus cases and the increasing number of people who are getting vaccinated.

According to the CDC’s website as of March 30, the total doses distributed are around 180,646,565, and total doses administered at 145,812,835. The CDC has also indicated that the number of people who have received at least one dose of a COVID-19 vaccine is 95,015,762, and the number of people who are fully vaccinated is 52,614,231. There are more than 332 million people in the U.S. So, we’re not quite at herd immunity but the goal is to be somewhere close around summertime, according to the Biden administration.

The Biden administration has announced that it is aiming towards increasing vaccinations in the next few months. They plan on supplying more vaccines, training vaccinators, and increasing vaccine locations so that more people don’t have to travel far to get a vaccine. In addition to that, the administration has been urging states to open vaccine eligibility to anyone in the U.S. that is 16 and older by May 1.

According to an article by NPR, they state that scientists estimate that somewhere between 70% and 85% of people need to be immune from the coronavirus before the disease will be able to wane through a process known as herd immunity. A professor from the University of Texas who directs its COVID-19 Modeling Consortium, Lauren Ancel Meyers, says:

The idea of herd immunity is that after enough people have been infected or vaccinated the virus will start to subside on its own because there’s just not enough susceptible people left to infect.

It might be some time until we have herd immunity in the U.S., but whether we are at herd immunity or not just the fact that more people are getting vaccinated is enough for some people to start traveling again. With spring break approaching, there has been a significant increase in travel. More states are opening up and reducing restrictions because there does seem like a light at the end of the coronavirus tunnel, which has more and more people getting comfortable with getting back into the things they normally would be doing around this time, like going on vacations.

CNBC reported that TSA officers screened the highest number of passengers on a single day since March 15, 2020. This number was still 20% lower than the number of passengers same day last year, and down about 28% from 2019. 

The number could easily continue to rise, especially when the U.S. holiday in May, Memorial Day, is right around the corner. Memorial Day has basically been the kick-off of summer and the start of summer vacations. And we know that people are ready and want to travel. 

Even if travel isn’t in the same position as it was in 2019, I believe it’s safe to say that people are venturing out and planning their future vacations, which is clearly a good sign for those companies that are dependent on people traveling and taking trips or vacations.

One of those companies is the home sharing company Airbnb (NASDAQ: ABNB). It’s been experiencing a slight rebound in its reservations. Of course, nowhere near where it has been in the past. This is what the company had to say on its website earlier this month: 

As U.S. citizens look to turn their pent-up travel dreams into reality, combined with President Biden’s plan to get the nation back outside by July 4, guests are increasingly looking for ways to safely reunite and meaningfully connect with loved ones on Airbnb. 

A competitor of Airbnb, Vrbo, which is owned by the travel giant, Expedia (NASDAQ: EXPE), has experienced a similar increase in its reservations. Its president, Jeff Hurst said:

We’ve had a phenomenal recovery. We could be looking at a real boom period for leisure travel.

He went on to say:

People will start booking more flights and hotels and resorts will have a big comeback.

People have hope that we are actually getting somewhere with fighting this pandemic, and that hope has seeped into the travel industry. Knowing that there is a plan or goal in place that expects to have over half the American population vaccinated by the summer is enough for some people.

Airline and hotel stocks like United Airlines (NASDAQ: UAL) and Southwest (NYSE: LUV) and Hilton (NYSE: HLT) and Marriott (NASDAQ: MAR) are set to surge as well during this travel rebound.

By summer, the U.S. could be on a much better path than it was a year ago, however, it’ll take some effort to make it happen. It will also require more people to be fully vaccinated in the next few months to get in a position that makes this optimistic feeling a reality.

Until next time,

Monica Savaglia

Monica Savaglia is Wealth Daily’s IPO specialist. With passion and knowledge, she wants to open up the world of IPOs and their long-term potential to everyday investors. She does this through her newsletter IPO Authority, a one-stop resource for everything IPO. She also contributes regularly to the Wealth Daily e-letter. To learn more about Monica, click here.