As optimism grows on Wall Street about the potential FDA approval for a coronavirus vaccine, here are six stocks that could make outsized gains and bounce back on the news, according to experts at Stifel.
Stifel’s picks include Carnival, Lindblad Expeditions and OneSpaWorld cruise stocks, casino operators Caesars Entertainment and Las Vegas Sands, and theme park and entertainment company SeaWorld.
Each of these titles suffered heavy losses in 2020 as travel revenues plunge amid widespread lockdowns and travel bans during the pandemic: Carnival is down more than 65% this year, OneSpaWorld by more than 55% and SeaWorld by almost 40%.
At a Miami-Dade County Tourism and Ports Committee meeting earlier this week, cruise line CEOs called for a return to service, “Enough is enough. It’s been over six months. As an industry, as a company, we have learned a lot about how to live alongside Covid, ”said Frank Del Rio, Head of Norwegian Cruise Line.
Although Stifel analysts say most stocks would benefit from a positive vaccine announcement, they believe “any kind of stock related to the cruise industry could outperform the rest.”
The firm particularly likes OneSpaWorld and Lindblad Expeditions, each with a market value of less than $ 1 billion: “While the logic would be to play the recovery through the ‘bigger’ cruise operators, if possible, we see a better opportunity thanks to two small -cap ideas ”, noted the analysts.
Stifel says Lindblad has an advantage with its relatively small cruise ships, which “dramatically reduce the number of people involved in creating a safe environment for passengers on board”. He also considers OneSpaWorld, which operates health and wellness centers on cruise ships and resorts, a safe bet: the company only needs to capture around 11% of the passengers on board to make its trip. functional business, analysts say. OneSpaWorld is “more isolated than the cruise operators themselves,” Stifel says, and it could also be a “major beneficiary” of onboard credits used to attract customers to cruise ships.
The US government has so far funded three potential coronavirus vaccines which are currently in phase 3 of phase 3 trials. The companies behind them are Moderna, AstraZeneca (in partnership with the University of Oxford) , Pfizer and BioNTech.
Large number: 6.4 million
That’s the number of confirmed coronavirus cases in the United States so far, with more than 191,000 deaths, according to the latest data from Johns Hopkins University.
“Vaccines against Covid-19 are being developed at a rapid pace … despite substantial uncertainty, the most likely outcome is that at least one vaccine will gain FDA approval this fall,” Goldman Sachs analysts predicted on Friday. last month. The company said the faster arrival of a vaccine – with widespread availability in early 2021 – would bolster prospects for an economic recovery: consumer spending would pick up in the first half of next year when Americans ” would resume activities that would have previously exposed them to Covid-19 risk. “
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