As people get ready to pack up and head out during the summer (yours truly included), investment ideas turn toward travel stocks. Summer travel season means that the airlines are increasing their earnings (Southwest, Delta and Continental are all reporting increased traffic), and hotels are gearing up (hotel indices can make interesting investment ideas). However, many people overlook another player in the travel industry: online travel Web sites. Travel Web sites offer unique investing opportunities. And, because it is prior to the summer travel season, and because Wall Street doesn’t appear to be giving them the love right now, you can get these travel stocks at bargain prices. Forbes reports on three travel Web sites offering what could be great travel stocks bargains:
During the recent pullback in the market, Expedia held and bounced off support at its rising 80-day moving average and has since resumed its ascent along support at its 10-day trend line. From a longer-term
perspective, the equity has rallied more than 75% from its August low…
Currently, the Schaeffer’s Volatility Index for Expedia is
approaching an annual low, indicating that the stock’s options are
relatively inexpensive at the moment. To take advantage of a continued rally in the shares as more than bears leave the sidelines, traders
should consider the stock’s May or July 22.50 call.
Another opportunity lies with Priceline.com.
The “name your own price” company has enjoyed a stellar rally, gaining roughly 200% from its October 2005 low. The equity is currently
consolidating its recent gains and moving into support at its 10-week
moving average. The shares could use this intermediate-term trend line as a springboard to launch it on the next leg of its uptrend. …
Finally, one other company to keep an eye on is Travelzoo. The Internet company displays travel deals and specials and related information on its Web sites. …
The equity has climbed along the support of its ascending 20-day moving average since the beginning of February and is currently holding above the 36 level, which is the site of former staunch resistance for the
shares. Meanwhile, short interest is roughly six times the stock’s
average daily trading volume, indicating there is still ample fuel
waiting on the sidelines that could add some lift to the shares.
While you can never be sure which way stocks and other investments will go, and no matter how things look there is always a risk of losing money, it really does look like a good time to start looking at travel stocks.