Travel stocks drop despite Australia welcoming visa holders, but one stock defied the trend
Link copied to
After several weeks of gains, travel stocks experienced a drop today even with a further relaxation in Australia’s border restrictions.
For several months, stocks rallied as Australia’s vaccination rate went closer to 80%, the threshold at which the government promised the border would open.
It has now been three weeks since Australia’s border opened for quarantine-free travel but this has only been open to Australian and New Zealand citizens and their immediate families.
But this week, Australia has finally launched that long promised travel bubble with Singapore allowing citizens of Lion City to travel to New South Wales, the ACT and Victoria quarantine free.
Prime Minister Scott Morrison announced from December 1, the privilege will be extended to Japanese and Korean citizens as well as fully vaccinated eligible visa holders.
However ASX shares in the travel sector dropped today along with the broader market.
While they’re still up by 46% on average in the past year, investors had a more muted response to this news this morning.
PTB Group (ASX:PTB), a company which provides aircraft maintenance and spare parts, provided earnings guidance for FY22 and it left shareholders impressed.
The company, which has operations in Australia but also the USA and the Maldives, expects a profit between $5.9 million and $6.2 million for the first half of FY22 which would be up 24-30% from the prior corresponding period.
For the full FY22 it forecasted $12.4m-$13.4 million which would represent 13-22% growth from FY21.
PTB Group credited this to an increase in engineering work as the effects of COVID-19 abated and tourism increased.