Early studies of the COVID-19 omicron variant suggest that the new strain could be less severe than earlier strains. Furthermore, vaccine producers Pfizer and BioNTech have given assurances that three doses of their vaccine will “neutralize” the variant. And, in response to omicron's surge, the U.S. government has imposed stricter testing requirements rather than international travel bans. Thus, we think travel services stocks Travel + Leisure (TNL) and TripAdvisor (NASDAQ:TRIP), which have gained significantly over the past few days, could soar higher in price in the near term. Read on.Nations worldwide are once again dealing with the COVID-19 induced uncertainty as the newly identified omicron variant threatens global public health and the economic recovery. However, early data about the variant coming from South Africa indicate that it may cause less severe symptoms. In addition, preliminary lab studies of the Pfizer Inc. (NYSE:PFE)/ BioNTech SE (NASDAQ:BNTX) vaccine shows that three doses of the vaccine would neutralize its threat.
The new variant has compelled some governments to re-impose travel restrictions. But rather than banning international travel, the U.S. government has decided to impose stricter testing requirements for travelers. Furthermore, the World Travel & Tourism Council (WTTC) has predicted that the U.S.’ travel and tourism sector could grow by 35.6% year-over-year in 2021, with promising prospects for the coming year.
Given this backdrop, we think it might be reasonable to bet on travel services stocks Travel + Leisure Co. (TNL) and TripAdvisor, Inc. (TRIP), given their fundamental strength.